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I have a hourly employee in Texas who has taken to milking the time clock: the employee will stay a few minutes late to complete a document that came in towards the end of their workday, or they were taking their lunch at their desk and if someone interrupted them, counting that as overtime (OT). We had a period of several months where the workload was increased, and there was legitimate overtime, and I think they got used to the extra money in their check.

Since then we have back filled, and there is no need for the OT anymore - in fact, no reason whatsoever for there to be unauthorized OT. They have stated every week during our touch point that they are not overwhelmed or too busy, yet I see OT getting clocked on every pay period, and their teammate has extra capacity to take on more, so there's no excuse/reason. Our company has a policy related to authorized OT, but laws around it still overrule.

This employee is taking a hard-line stance on their hours (recording every minute worked), while still enjoying all the flexi-benefits that are NOT part of their contract (such as telecommuting and working non-typical business hours). We all signed an employment contract when we were hired. Telecommuting is NOT a benefit of that contract, just the office environment.

I've taken the stance that they cannot work more than their 40 hours unless authorized, and that if they cannot complete their work in that 40 hours, then we will need to adjust their telecommute and business hours worked. I've also engaged our HR group to be on the safe side.

This employee has other issues as well (attitude related to the client and coworkers, not performance of tasks). I am attempting to coach the communication issues, but the client is not a fan of this employee, therefore, any excuse they have, they are starting to press my company. Not overtly yet, but I'm trying to head that off as I do not have the capacity to also do this person's job.

This is otherwise a good worker, but they feel they have been "shorted" and taken advantage of by the company (they are at the very top end of the pay scale for their position, but feel they are owed more due to work). While I don't entirely disagree with the fact that their compensation is low for the tasks, on the other hand, there's nothing I can do about it other than request a bigger raise (which I have tried, and got shot down).

In the meantime, reality is, the company does not want to be paying overtime. Our financial group and client are being strict about OT, and do not allow it with other employees. Most hourly employees in our group are fine with booking their 40 hours and enjoying the flexi-benefits that come with the roles we have. This employee is not okay with that (and legally they have the right to operate this way) so I've had to return their hard-line stance with my own.

Do you have suggestions, besides formal discipline, to help mediate situations such as these?

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  • Comments are not for extended discussion; this conversation has been moved to chat. – Jane S May 19 '19 at 0:13
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    Your question seems to be about unauthorized overtime, but then you talk about performance, client pressure, communication skills, work from home, pay rate, and other issues. You need to divide and conquer - focus on one thing at a time - or you're going to end up with everyone involved confused and hurt. – dwizum May 20 '19 at 13:00
  • @dwizum The communication and client issues came from the comments. I included them in my edits because I intended to reference them in the answer I'm working on and I felt it was relevant that this employee's standing was shakey. If it blurs the issue being asked about, I'm OK with it being removed. (Performance, telecommuting, and pay rate were already mentioned in the original question.) – BSMP May 20 '19 at 13:17
  • Getting paid for the hours one works is not a “hard-line” stance. – prieber Mar 30 at 20:57
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This employee is taking a hard-line stance on their hours (recording every minute worked), while still enjoying all the flexi-benefits that are NOT part of their contract (such as telecommuting and working non-typical business hours).

I'm sorry, but what do these "flexi-benefits" have to do with getting paid for time worked? An employee should be paid for all time worked. If you perceive that there's some financial benefit to the employee for these flexi-benefits, then adjust their hourly rate accordingly... and then pay them for every minute they work. Offering flexi-benefits doesn't negate your responsibility to pay the employee for every minute worked... at whatever hourly rate they're at.

As for the overtime, if you don't want employees to work overtime unless it has been expressly authorized then state that clearly and unequivocally in a written policy document and then consult your legal team on what recourse you have if employees disregard this policy.

Also, you mention that this is an employee but then you also mention their contract. Are they an employee in the legal sense or are they in fact an independent contractor? If the latter, you'd do well to research what local and federal laws govern employee/contractor classification so as to not put the company at potential legal and financial risk due to classifying your workers incorrectly.

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    An employee should be paid for all time worked. While that is correct, this does not extend to "An employee should be paid for all the overtime they decide to do without anyone asking them to do so". An employee cannot just force their employer's hand like that. This would be easily exploitable. A contract which stipulates a precise amount of hours, stipulates this "no more, no less, unless mutually agreed upon". From OP's question, the overtime is not mutually agreed upon, and the employee cannot just decide that they should do and get paid for overtime. – Flater May 20 '19 at 10:48
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    It is the duty of management to exercise control and see that work is not performed if the employer does not want it to be performed. An employer cannot sit back and accept the benefits of an employee’s work without considering the time spent to be hours worked. Merely making a rule against such work is not enough. The employer has the power to enforce the rule and must make every effort to do so. Employees generally may not volunteer to perform work without the employer having to count the time hours worked. – joeqwerty May 20 '19 at 14:00
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    How exactly do you expect an employer to enforce this, if not by communicating that no overtime is authorized? How should they further enforce the rule if the employee is still willfully staying after their hours, knowing full well that no overtime is authorized? Should they physically remove their employees from the work site? (and even with that extreme, that is still not enough for some jobs since FLSA does not require worked hours to take place in the workplace). – Flater May 20 '19 at 14:05
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    Your proposed interpretation leaves glaring holes. How could this be enforced when communication is ignored? You stated that a company should enforce it further, but you give no explanation. This answer would effectively argue that anyone who forcibly stays at worked clocked in is automatically entitled to overtime pay, even if they have already been instructed that no overtime is currently authorized. If the employee is told/expected to work after hours, I agree that this is overtime that needs to be paid, but the employee is being told the opposite and effectively ignoring it. – Flater May 20 '19 at 14:47
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    @Flater They should react by punishing them severely enough that the problem stops. That may start with verbal warnings, escalate to reducing paid hours, and ultimately end with termination. It is an employer's responsibility to prevent employees from violating the employer's rules, even with termination if all else fails. Otherwise, the rules aren't rules. This is an employee whose failure to follow reasonable policies is costing their employer money. – David Schwartz Mar 27 at 22:16
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If the employee works overtime, you have to pay them, regardless of whether you approved the additional hours or not. It sounds like informal requests that he stop working overtime have not worked, so your only option left is formal discipline. If you don't want to do that, the employee will likely just keep ignoring your stipulation that overtime must be approved, since there will be zero consequences for working unapproved overtime. You are currently allowing this person to ignore you, so this is a disciplinary issue at this point.

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  • Agreed, was just hoping to see if people has success in coaching these issues before going the formal discipline route. – Honey Badger 302 May 17 '19 at 19:36
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    AFAIK, an employer DOES have the right to discipline an employee for working unauthorized overtime, but I'd make darned sure you're in compliance with whatever local and federal laws are applicable before going the discipline route. – joeqwerty May 17 '19 at 19:53
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Do you have suggestions, besides formal discipline, to help mediate situations such as these?

This really depends on what you want the outcome to be. This sounds like you have a good employee who is underpaid, knows it and is unhappy about it. The overtime discussion is just a symptom, you need to attack the root problem.

There are three different option:

  1. Get the employee's pay up to market rate.
  2. Make the employee somehow satisfied with the low pay. You could try to discuss whether there are any fringe benefits that would offset lower compensation. But it's a long shot.
  3. Put your foot down and hope he doesn't quit. Even if he doesn't leave, he will be unhappy

So if your desired outcome is "I want people to accept low pay and be happy about it", you have a tall mountain to climb. That's very unlikely to happen.

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  • I'm not quite sure I agree with the underlying tone of the answer which suggests that any employee who wishes to be paid more (and is willing to put in extra hours if necessary) is able to force the hand of the company to get some sort of payrise or compensation for it. Consider the situation of a small shop owner who can only afford one additional employee's wage: would it be fair for that employee to strongarm their employer into paying more (even if they work more hours for it)? – Flater May 20 '19 at 14:09
  • Additionally, offering compensation or a payrise is the opposite of what OP's company wants. A company that does not permit overtime is doing so because they want to limit wage costs. Increasing a worker's wage is doing the opposite. This also will lead to a snowballing effect. If Bob gets a payrise or compensation for their desire to work overtime, then other too will start claiming they wish to work overtime, and everyone will expect to get compensation for it even if they don't end up working more hours. – Flater May 20 '19 at 14:11
  • I understand that the company wants to pay low. There are free to do so. However, employees are equally free to want market rate. There is no ethical obligation for employee to accept lower pay simply because the company can't afford it. By definition, other companies are willing to pay this rate. – Hilmar May 20 '19 at 20:49
  • I have looked up area payrates - this employee is actually being compensated extremely well for the area. They would be very hard pressed to find higher pay even at a higher level. The issue they have is their responsibilities have increased, but their pay was not beyond "normal" increases. Judging by what I see in their area, they probably don't actually want to leave as I think they would struggle even with a higher-level position to meet their current rate (which is why the company is unwilling to paying more as well). – Honey Badger 302 May 21 '19 at 18:07
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They CHOSE to sit at their desk - I have instructed them to leave the work area during break. If they are at their desk, they are perceived as being available

I used to have a rule that I cannot book continiously time, for example, from 9:00 to 15:00, I must leave out half an hour for lunch, regardless of where I am. It is related to some regulations (Finland).

Since your contract does not include flexi time anyway, you could try to negotiate a rule like that. Say that you care about their relaxation and instruct to ignore incoming work calls during that time, even if they are at their desk.

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It is extremely common to have a firm policy that overtime is to be worked only on prior approval (or in the case of well-documented emergencies, if this is a factor) and that unapproved overtime won't be paid. I'd be gobsmacked if there's any jurisdiction in which an employee can sit at their desk until midnight every night, against the company's orders, and then put in for tens of hours of overtime.

But you need to work with your company's HR department on this. Likely they will have a standard set of words to convey this. Make sure that whatever you do, they will back you up.

You could also say that overtime is to be made up with time-in-lieu, i.e., if they work an hour late one day then they can come in an hour late, or leave an hour early, another day; providing it doesn't conflict with necessary work schedules. Often there is the stipulation that this be done in the same pay period, so it can't be accumulated into whole days off. This guards against "malicious compliance", like hanging up on a caller mid-call at precisely quitting time.

Of course the employee could just give two weeks notice. Overall, it rather sounds like this employee is heading towards a career transition, which perhaps they're trying to defer. They've got no advancement opportunities with your company and a few extra dollars of overtime is pretty much their only carrot. If you've got other misgivings with this person, treat them fair but firm, don't let other performance problems mount, and prepare to receive their notice.

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  • Another approach is to say that the employee shouldn't work for more than 38 or 39 hours a week. This way, you don't get bitten if something important comes up at 6 PM on a Friday. – Stephan Branczyk Mar 28 at 11:34
  • Not paying unapproved overtime may be illegal depending upon local laws, making the company liable for fines entirely out of proportion to the amount of the unpaid overtime. – jmoreno Mar 28 at 19:45
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The fundamental problem here appears to be that the employee is being underpaid. At least, they think that, and you don't disagree.

In which case, why not just talk turkey? Explain that you know they're underpaid, and that you've broached the issue of a payrise on their behalf, but have been firmly rebuffed by your own management.

Explain that you're under pressure yourself to curtail overtime claims, and that you can't allow continued claims. If they want higher pay, you regret to say, they'll have to leave for better pastures entirely. But if they stay, it will have to be for the basic salary only.

If the real problem is that you can't afford them leaving, then talk turkey with your own manager, and explain that the two alternatives you face are either accepting the continued overtime claims (or some other concession) as part of "local arrangements" to keep the wheels greased, or suffering business disruption on account of hastening this person's departure.

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Depends upon what you mean by formal discipline. You almost certainly are legally required to pay the overtime, with potentially severe consequences for not doing so. So, not paying isn’t an option.

But I wouldn’t consider it punishment to reduce their their hours the following week by a day every 5 hours over, rounded up. It’s simply making the budget work out. This fixes your budget problems while making it clear that you mean it about unauthorized overtime.

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I assume that the person has to put in their hours? Require they have their hours for the week in by end of day Thursday. Then on Friday call in when they should be hitting their 40 hours and tell them to clock out and go home. Any padding they did through out the week is nullified by going home early.

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Assuming that you are the manager of the employee in question, then I think that you should consult with your HR Department next. They will be able either to advise you what to do, or, preferably to act directly on your behalf and "on behalf of the company." In either case, they will do so in a way that is acceptable to corporate counsel. (Which is important, because this now is "a legal matter.")

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