Time For Business

Using A Temp Agency May Not Keep You Off The Hook

joint-employersAccording to the US Department of Labor’s Wage & Hour Division (WHD), more than 160 workers at a Philadelphia direct mail and printing company will receive $1.45 million in back wages and damages after a federal investigation found their employer and a staffing agency failed to pay overtime wages.

The back story

The WHD investigated direct mail processor ICS Corp. and two staffing companies it retained, New Century Integrity Corp. (and its owner Hokkito Teddy) and Richy Services Inc. Richy failed to produce any payroll or time records, so it’s unclear if they actually supplied any workers at all. New Century, however definitely did supply temporary employees to ICS. And that’s where the trouble started… Find out what they did wrong, and what YOU can do to avoid the same trouble

Go Directly To Jail. Do Not Pass “GO.” Do Not Collect $200.

I’ve written before about how paying back wages and penalties may not be the worst thing that happens to a business owner who underpays his workers. Turns out, you can also end up doing time in jail.

But, surprisingly, not everyone seems to have gotten the message. Apparently, not every business owner and manager reads this blog. (I know, right? Shocking!)

Specifically, Abdul Jamil Khokhar, who (operating as BMY Foods, Inc.) owned and operated nine Papa John’s franchises in New York City, seems to have been operating under the misapprehension that he could get away indefinitely with not paying hundreds of his employees the overtime to which they were legally entitled.

The Back Story

As the story goes, it may have been that Mr. Khokhar was underpaying his employees, and somehow the US Department of Labor (DOL) got wind of this. Or he may have simply been unlucky, and been selected for a random audit. The DOL does conduct these from time to time, focusing particularly on low-wage industries, such as pizza-delivery franchises.

In any case, the DOL was investigating his payroll policies and practices.

According to court documents filed by the prosecution, when Mr. Khokhar learned he was under investigation, he sprang into action. Unfortunately for him, this action didn’t seem to involve anything along the lines of “correcting any errors and paying his workers properly going forward.” Instead, here’s what he did:

  • Created a bunch of ficticious “employees” in his timekeeping system.
  • Required each employee who was approaching the overtime threshhold (between 35 and 40 hours in a week) to begin clocking in and out under one of these phony names instead of continuing to clock in under their own name.
  • Paid the employees under the table, in cash, for the hours they worked under the fake name. (Straight time only; no time-and-a-half overtime.)
  • Maintained a separate set of books to record the cash payments, to try to hide them from the DOL investigators.
  • Filed false quarterly tax returns with NY State that omitted the cash payments, in an effort to further conceal the deception. (This resulted in underpayments to the State Unemployment Insurance Fund, among other things.)

The Aftermath

Working together, the NY State Attorney General’s Office (NYAG) and the DOL were able to uncover the scheme. For instance, the NYAG executed a search warrant at Mr. Khokhar’s franchise office and found his records of both the cash payments and the phony names.

So now the NYAG has filed criminal charges. They’re seeking not only $230,000 in back wages for 300 current and former employees, they’re also asking for jail time for Mr. Khokhar. The DOL has already obtained a consent judgment ordering him to pay $230,000 in liquidated damages to employees and $50,000 in civil monetary penalties. (Keep in mind, this is on top of any legal fees Mr. Khokhar and his business may have incurred so far, or that they will incur in the future as the criminal proceedings play out.) In addition, under the terms of the judgment Mr. Khokhar’s Papa John’s franchises must create procedures for an internal compliance officer and will be subject to independent auditing of their practices.

I’m thinking it might have been easier (and cheaper) to simply pay the overtime. Agree?

The Solution

Absolutely, overtime calculations can sometimes be tricky. Two things that can save a business owner a lot of headaches (and, potentially, a lot of legal trouble) are a good time tracking system, and a good payroll system. Fortunately, Acroprint can help with both of those. Our AcroTime workforce management platform includes both time & attendance and payroll modules, seamlessly integrated to make it all as smooth and easy-to-use as possible. Better yet, both modules offer a ton of advanced features to help you better manage your workforce and control your labor costs (all while staying on the right side of the law). See for yourself — request your free, no-obligation demo today!

How to Get Help With Your Acroprint Product

Here at Acroprint we take a lot of pride in producing reliable time tracking equipment. But sometimes bad things happen to good time clocks. Or maybe everything seems to be working OK, but you just have a question about a particular feature of your Acroprint software or clock. What can you do to get answers or help?

Know What’s Available

help

We offer several options for getting help. Which one you choose depends on what you need, and which product you have.

  • For general assistance, a good starting point is the Support section of our website. If you’re not sure which product you have, we display images of each product to help you identify what you’ve got, and quick links to various support resources for each product.

  • Often, your question or issue might be addressed in the User Manual. But if your desk is anything like mine, it’s cluttered with User Manuals only as long as you don’t need any of those User Manuals. The minute you go looking for a specific manual, it disappears into a black hole, never to be seen in this universe again. Fortunately, we offer free downloadable PDF versions of almost all of our User Manuals (and a lot of other useful documentation) at our User Documentation Download Center. (Yes, even for older and discontinued models!)

  • Another place to get help is in our Support Knowledgebase. Here you can browse or search to find answers to common questions, how-to instructions, troubleshooting advice, even instructional videos covering most Acroprint products you can name (yes, again including older and discontinued models).

  • If you’ve checked the user guide and the knowledgebase and still need additional assistance, you can contact us directly.

Speed the Process

If you’ve determined you need to contact us by phone or email, here are a few tips to ensure you get the fastest and most accurate response:

  • Identify your product. You might be surprised by the number of support requests we get from people who seem to be confused over which product they have. It’s to your benefit to take the extra few seconds to verify what you’ve got. Otherwise, your request may be accidentally routed to the wrong department and it may take longer for you to get the help you need.

    Just to clear up a point of confusion for some customers: “Acroprint” is not a product — that’s the name of the company. Your product name will be something like a model number (Model 125, ES700, ATR360, and so forth) or the name of your software or software bundle (Attendance Rx, timeQplus Proximity, Pendulum, etc.).

    Also, “AcroTime” is the name of our cloud-based workforce management product, which requires a monthly subscription. AcroTime has it’s own dedicated website. Support requests sent through the AcroTime website are routed to a special AcroTime team. If you have a different software product (such as Attendance Rx or timeQplus) but use the AcroTime website to request help, it may take longer for you to get an answer, because your request will have to be re-routed to the correct support team.

    Getting the correct product make and model is one of the most important things you can do ensure your request is routed efficiently to the most appropriate support personnel.

  • Gather as much information as you can about your product. Have you registered your warranty with us? If not, knowing when and where the product was purchased might be helpful, especially if your product is newer and potentially still covered under warranty. (Remember our industry-leading two year hardware warranty!)

    It’s also handy to have the serial number available if at all possible. For mechanical and electronic clocks, the location of the serial number plate varies by model, but generally it will be located on the outside of the clock case at either the back or bottom of the case. For software products, log in to the software and select the “Help” or “About” item from the menu to find your serial number and/or install key.

  • Use the correct contact channel for your product. For most of our products (mechanical and electronic clocks, installed software, and rounds tracking products), visit our contact page. You can call us or send us an email. If you send an email, be sure to select the correct product from the drop down list on the contact form. (Note that if you decide to call and your product is out of warranty, charges may apply for telephone support.)

    If you have a subscription to our cloud-based AcroTime product, log in to your dashboard and use the “feedback” button to report an issue or ask a question. If you need help logging in, visit the AcroTime contact page and submit the email form.

Summing Up

I know it’s frustrating when you have a problem or an unanswered question about a product — especially when the problem can impact your ability to run payroll! We really do strive to take care of issues as quickly, accurately, and completely as we can.

With just a little help from you, we’ll be able to resolve your query faster and get you back to business as usual.

How NOT to Record Employee Hours

You know, here at Acroprint, we’re big advocates for recording and tracking employee work time (yes, even salaried exempt time). But, you know, there’s a right way and a wrong way to go about it. Now, I thought after my time in the industry I had seen everything. But an auto repair shop has managed to stumble across a novel method of recording employee time that I had not come across before. One which may end up getting them in trouble.

As the story goes, Jeffrey Moran worked as a mechanic at the shop from 2011 to 2013. He said when he was hired, he agreed to work six days a week (about 58 hours per week) for $300 plus profit-sharing bonuses. The employer claims he was hired to work 30 hours a week for $300, with no bonuses. There doesn’t seem to have been any written documentation either way. (Pro tip: when you hire someone, write down the basic terms of employment. Have both parties sign the agreement, and both keep a copy. Could save you a world of hassles on down the road.)

Moran did apparently receive an occasional extra payment that might have been a “bonus,” and reportedly was allowed the use of a car belonging to the manager. However, he did not feel this was sufficient compensation for the time he claims to have been working.

Eventually, this disagreement over the terms and conditions of his employment came to a head, which culminated in Moran reportedly being told to “either hit the road or stay working like it is.” Moran chose to “hit the road” and subsequently filed a lawsuit claiming unpaid overtime and retaliation.

Moran testified in court that he actually worked 65 to 68 hours a week, but he didn’t offer any written documentation. The employer offered copies of handwritten time sheets, which they claimed documented Moran only working 30 hours a week. But here is where it gets really strange.

Find out what the employer did to record employee hours and how it may come back to bite them

An Expensive Misconception

Recently I came across the story of a grocery store in Portland, Oregon, that has to pay nearly $100,000 in back wages and damages to 11 workers. What got the store in trouble is actually a fairly common misunderstanding.

The store had paid the 11 workers a straight salary for all the hours worked in a week, with no overtime. The problem? None of the workers met the criteria to be considered exempt, which means they should have been paid overtime anytime they worked over 40 hours in any workweek.

According to the store owner, the reason he had been paying the workers a straight salary was that the workers themselves wanted to be paid on a salary basis rather than hourly.

And that’s fine. As a business owner you can choose to pay by the hour or salaried, as you see fit.

Salaried Does Not Equal Nonexempt

The problem is: just because someone receives a salary, that doesn’t mean they’re exempt from overtime. Sure, being paid on a “salary basis” is one of the criteria, but it’s not the only standard the job has to meet to be considered exempt. Read more about these criteria and what the store owner should have done

Deliberate Or Not, They’re Still On The Hook

In my last post, I mentioned a lawsuit filed by the Department of Labor (DOL) against a group of related NY-area companies. Apparently, one of the things they were supposed to have done was to avoid paying overtime for employees who worked more than 80 hours in a two-week period by splitting the hours up among “related businesses” to make it look as though the employee had worked no overtime for any given individual business.

The problem, of course, is that when the companies are in the same line of work, and share a common management and ownership, and their corporate headquarters share the same address, they’re very likely going to be seen as a single entity for the purpose of calculating overtime hours.

I’ve run across several stories lately of companies getting tripped up by the overtime issue. It’s not always clear whether the company owners were deliberately trying to avoid paying overtime, but in a lot of cases it certainly seems suspicious. For instance, here are a few things I’ve come across recently that made me go “Hmmmm”:

Read more to learn how NOT to pay your workers

Don’t Try This At Home

From the “Don’t Try This At Home” files comes the story of Alliance Property Services, Inc. and three affiliated companies. The companies, based out of Salina, NY, have been sued by the U.S. Department of Labor (DOL) for — among other things — failing to pay proper overtime to their employees.

According to the lawsuit, the workers were employed to travel to foreclosed properties across New York and neighboring states to mow lawns, winterize homes, change locks and do light construction work.

Reportedly, the employees traveled long distances and often worked more than 60 hours a week, according to Jay Rosenblum, Albany district director for the DOL’s Wage & Hour Division (WHD). But according to the DOL, the company only paid them straight time, by splitting their hours and writing checks from two different sister companies, or by paying in cash “off the books.”

Read the rest of the article

A Spectacularly Bad Idea

A restaurateur in Santa Fe, NM learned the hard way that it’s a bad idea to try to fool the Wage & Hour Division (WHD) of the Department of Labor (DOL). In this case, it was a bad idea to the tune of over $50,000.

Famous Wok franchisee Lixin Zhang was originally found to have underpaid two workers based on the results of a WHD investigation. According to the WHD press release, his employees worked 72 to 80 hours per week with no overtime pay. (Oh, and he apparently also didn’t keep accurate records of their hours worked. Because, of course, then he’d know they were working all that unpaid overtime, I guess?)

blank-checkBut, you know, investigations happen all the time and barely register as news. It was what Zhang supposedly did next that caught the attention of the Feds.

Most employers will pay the back wages, review their recordkeeping and payroll practices to make sure it doesn’t happen again, and move on with life. Reportedly, Zhang had another idea.

Find out what the bad idea was…

You Can’t Have It Both Ways

sushiFrom Hawaii comes the story of the Tsukiji Fish Market and the tip pool that cost them over $57,000.

Reportedly, Paradise Inn Hawaii LLC, doing business as the Tsukiji Fish Market in Honolulu, elected to take the tip credit when paying their wait staff, but then forced their tipped employees to share those tips with other back of the house workers who are not normally tipped.

What is this “tip credit,” anyway?

Learn how a tip pool SHOULD be used

Avoiding Telecommuting Wage & Hour Pitfalls

There’s a lot to like about telecommuting. Employees who work from home are often more productive and generally report greater job satisfaction. Organizations who allow employees to telecommute can save money on office space, supplies, utility costs, employee turnover and more.

But there can be issues with telecommuting, as well. Especially when the telecommuters are overtime-eligible employees.

The Fair Labor Standards Act requires employers to keep accurate records of work time for all non-exempt employees. If they work more than 40 hours during any single week, you’re required to pay them overtime at the rate of one-and-a-half times their “regular rate of pay.” In some states, you may be required to pay overtime if they work more than eight hours in a single day.

Some states also require employers to furnish lunch and/or breaks if employees work over a certain number of hours in a day. How do you prove employees have taken the required breaks when those workers aren’t in your office?

Find out how to stay out of trouble with the DOL if you have telecommuting employees

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