LAW-RELATED WEB SITES
The Fair Labor Standards Act (FLSA),
a federal law, is the basic source of wage and hour
law. This law defines the minimum wage (currently $7.25/hr),
as well as overtime pay provisions, child labor, record
keeping, and some other related topics. It also contains
the Equal Pay Act which mandates equal pay for equal
work regardless of gender. The Wage and Hour Division
of the Department of Labor (DOL) administers this law.
Whether an employee is to be paid overtime is decided
by the classification of "non-exempt" or "exempt."
Generally speaking, administrative staff, professionals,
outside sales people and workers in certain trades are
considered exempt from minimum wage and overtime provisions.
The Department of Labor (DOL) does have written guidelines
on designating exempt status. Only being salaried, or
having a certain job title, does not make an employee
exempt. The nature of the work and the work relationship
define exempt or non-exempt status. With some minor exceptions,
employees classified as exempt must be salaried and spend
20% or less of their workday on line duties. The other
80% of work time must be devoted to supervisory, specialized
or original work.
is specified under FLSA as time and a half for all hours
worked in excess of 40 hours in a week (not 8 hours
in a day), and it is to be paid in cash. The Act does
require overtime pay for employees who are "engaged
to be waiting" or on-call. The employee cannot
effectively use on-call time for his/her own purposes.
Pay of Salaried Exempt Employees
Employers cannot dock exempt employees for partial day
or several days of absence without changing employees'
status from salaried to hourly. When an employee is hourly,
the employer must pay overtime. By changing status, the
employer would be liable for all back overtime worked.
Since an exempt employee must receive full salary for
any week in which any work is performed, suspending this
employee for a week is a viable option. Progressive disciplinary
processes leading to termination are also an option. FLSA
delineates how and what deductions from pay can be made.
The Texas Payday Law also covers deductions from salary,
so employers need to consider both options before making
deductions from pay.
Classifying an employee as an independent contractor must
be done according to the Department of Labor's (DOL) "economic
realities" test. Degree of control or direction over
the worker, the worker's investment and opportunity for
profit and loss, work permanency, degree of skill and
whether the work is an integral part of the employer's
enterprise are involved in the determination. The Internal
Revenue Service also has a definition of independent contractor.
It provides a list of criteria that is used by the Texas
Workforce Commission for determining unemployment taxes.
Generally, very few workers fit the description of independent
and Break Time Pay
Travel time from one work site to another work site during
the workday must be paid. However, travel time going to
work or returning home does not qualify for pay. Breaks
that are 20 minutes or less count as paid work time.
The following employee benefits are not required under
FLSA: vacation time, holidays off, severance or sick pay,
meal or rest periods, premium pay for weekends or holidays,
pay raises, or fringe benefits. It also does not require
a discharge notice, reason for discharge, or immediate
payment of final wages to terminated employees. Individual
company policies apply to all of these categories and
should be followed with consistency.
The Texas Payday Law states that employers
must pay employees in full and on time on regularly
scheduled paydays. The Texas Workforce Commission Payday
Law Unit has powers of enforcement and adjudication
for this law. The law has very strict guidelines for
wage payments. A mandatory poster is available from
TWC for display.
Definition of Wages
The Texas Payday Law defines wages as "compensation
owed by an employer" for
- labor or services rendered by an employee,
whether computed on a time, task, piece, commission,
or other basis; and
- vacation, holiday, sick leave, parental
leave, or severance owed to an employee under a written
agreement with the employer, or under a written policy
of the employer.
The basic wage agreement can be either
verbal or written, or both, and is enforceable on both.
Fringe benefits must be in writing to be enforceable.
Some Provisions Under Law
- Without specific written authorization
from the employee, no deductions may be made from
a paycheck unless they are court-ordered deductions
or payroll tax deductions.
- If an employee is laid off or discharged,
the employer must give final pay within 6 calendar
days of the effective date of discharge.
- If an employee quits or resigns, the
employer must give final pay by the next regularly
Final Pay Deductions
While the dates for final pay are relatively straightforward,
the question of deductions in pay merits special attention.
- No matter the circumstance, deductions
in pay must be covered by a written agreement signed
by the employee.
- Loan advances, expense advances, losses
caused by employee, uniform and cleaning expenses,
cost of failure to return property and other legitimate
expenses must be specifically dealt with in the written
and signed agreement prior to making a deduction.
- General policy statements dealing with
deductions should be included in a company handbook,
but will not be sufficient for terms of the Payday
Law. A deduction authorization agreement should be
specific, clear and reasonable, written and signed.
This can be done in a general deduction authorization
agreement at the beginning of employment. Deductions
that are unforeseen can be covered in a separate agreement
as the need arises.
|Wage and Benefit Agreement
Putting a wage and benefit agreement in writing is helpful
to both employer and employee. Any confusion can be avoided
by having clearly spelled out documents. Wage and benefit
agreements are one of the terms and conditions of employment
that may be changed or terminated at will by either party.
Additionally, if a wage claim is filed and investigated,
the Texas Workforce Commission (TWC) follows the "best
evidence" rule. Unambiguous, clearly delineated agreements
are crucial for a favorable ruling.
When a new employee is
hired, certain procedures can facilitate a smooth employment
relationship. Giving the new employee a company handbook
and having a signed statement of receipt is one of the
most important first steps. The handbook must clearly
and specifically explain company policy and procedures
to be useful.
Because Texas is an at-will state, the
handbook can be changed and updated as needed, as long
as all employees are notified. Communicating company
policy can only help the employee in understanding required
work performance. In addition, a good handbook will
improve an employer's position, not just in any investigative
procedures, but in all aspects of employee relations.
Having a new employee sign any wage deduction
agreements is another critical procedure that is covered
under the hiring section of the Texas Payday Law. In
general, Texas employers are able to design and change
their own personnel, compensation and benefits policies
with few restrictions. Letting a new employee know exactly
what these policies and procedures are from the beginning
helps in getting desired work performance. This information
also protects the employer from misunderstandings when
Employers must comply with the Immigration Reform and Control Act of 1986. They must verify employment eligibility of all applicants actually hired. The identity of the applicant and the applicant's authorization to work must be established. Once documents are verified, a Form I-9 must be filled out. It is preferable that copies of the verifying documents be made.
The I-9 forms must be kept a minimum of three (3) years or one (1) year after the employee leaves the job, whichever is later. Forms must be available for government inspection upon request. An I-9 form, as well as other useful information such as lists of acceptable documents, can be downloaded from the US Immigration Support page.
Employment verification links:
Guidelines for Hiring Workers with Disabilities
The U.S. Department of Education has two guides that assist employers to integrate individuals with disabilities into their workforce. They can be accessed at this link:
Disability Employment 101
Americans with Disabilities Act
All employers with fifteen (15) or more employees must comply with this law. Under ADA, an employer may not ask about an applicant's prior or current medical condition, prior injuries, prior claims for compensation, or disabilities. An employer may only inquire into a person's ability to perform the essential functions of the job, with or without reasonable accommodation.
Employers can hire the most qualified applicants, but must consider all persons without discriminating on the basis of disabilities. Employers do not have to lower their performance standards nor hire individuals with disabilities over applicants who are not disabled.
People who have been treated in the past, and/or are currently being treated, for drug or alcohol abuse are protected by the ADA. Current users are not protected. A job offer may be made contingent upon the results of a medical exam. All candidates for that job must have the same exam.
The U.S. Equal Employment Opportunity Commission has information on the Americans with Disabilities Act (ADA). Access this information at: Small Employers and Reasonable Accommodations.
The U.S. Department of Labor lists the facts and myths associated with the Americans with Disabilities Act (ADA). Click on Employers and the ADA.
|Business Tax Credits
There are tax credits and incentives for employers who hire persons with disabilities. For more information, click on these links:
U.S. Department of Labor Office of Disability Employment Policy
JAN Job Accommodation Network
|"Disability is Not Lack of Ability” - EMPLOYER TOOLKIT
Workforce Solutions invites you to review the materials in this Employer Tool Kit and learn about additional employer benefits associated with hiring persons with disabilities.
Since October 1, 1998,
all employers have been required to report specific
information about newly hired and rehired employees
to the Texas State Directory of New Hires. This reporting
requirement is due to a federal law whose primary purpose
is to enforce child support orders.
Employers must give information about
any individual who completes a W-4 (Employee Withholding
Allowance Form) at the start of work, and/or to whom
the employer will issue a W-2 (Wage and Tax Statement).
Employees who return for a recall from a layoff or from
a leave of absence must also be reported if a new W-4
is submitted. Information must be sent within twenty
(20) days of each employee's first day on the job. Various
reporting methods can be chosen.
Information on the reporting methods,
along with what needs to be reported, is available here.
Sexual harassment is a
legal offense under civil law. There are two types:
"quid pro quo" and "hostile environment".
"Quid pro quo" involves basing
hiring, firing, promoting, and salary decisions on an
employee's submission to sexual demands. "Hostile
environment" involves conduct that creates an intimidating,
hostile, or offensive working environment. Employers
can be held liable for sexual harassment even if they
do not know it is happening.
Preventative measures are imperative to
protect an employer from liability. An explicit policy
against sexual harassment that is clearly and regularly
communicated to employees and effectively implemented
should be in place. A grievance procedure for resolving
complaints should also be in place, and it needs to
be one that does not require going first to an immediate
If a complaint is made, act immediately!
The EEOC investigates to determine that employer action
was prompt, appropriate and effective. Do not disregard
any complaint. Carefully document all phases of the
investigation from the initial complaint through witness
interviews to any action taken. Be very careful to keep
the investigation confidential. Disciplinary measures
for employees found guilty of policy violations may
include verbal or written warnings, transfers, demotions
or discharge. Prompt remedial action constitutes a very
effective defense against legal liability.
AND MEDICAL LEAVE ACT
The Fair Labor Standards
Act (FMLA) requires employers with fifty (50) or more
employees within a seventy-five (75) mile radius to
offer eligible workers family and emergency medical
leave. This includes up to twelve (12) weeks of unpaid
leave during a twelve (12) month period for birth or
adoption; to care for a seriously ill parent, spouse
or child; or to undergo medical treatment for their
own serious illness.
To be eligible for leave, a worker must
have been employed for at least twelve (12) months and
have worked a minimum of 1,250 hours during the twelve
(12) calendar months immediately prior to the beginning
of the leave. The right to take leave applies equally
to male and female workers. When an employee returns
to work after taking leave, an employer must guarantee
that the employee can return to the job he or she held
before the leave, or an equivalent position. To be an
"equivalent" position, all privileges, duties,
terms and conditions of the worker's previous job must
correspond. The twelve (12) weeks of leave provided
under FMLA is cumulative of whatever leave an employer
already allows. If six weeks of paid leave were allowed,
as an example, only six weeks of unpaid leave would
FMLA is administered by the Wage &
Hour Division of the U.S. Department of Labor.
|MILITARY FAMILY LEAVE LAW
On January 28, 2008. President Bush signed into law the National Defense Authorization Act for FY 2008 (NDAA), Public Law 110-181. Section 585(a) of the NDAA amended the FMLA to provide eligible employees working for covered employers two important new leave rights related to military service:
- New Qualifying Reason for Leave. Eligible employees are entitled to up to 12 weeks of leave because of “any qualifying exigency” arising out of the fact that the spouse, son, daughter, or parent of the employee is on active duty, or has been notified of an impending call to active duty status, in support of a contingency operation. By the terms of the statute, this provision requires the Secretary of Labor to issue regulations defining “any qualifying exigency.” In the interim, employers are encouraged to provide this type of leave to qualifying employees.
- New Leave Entitlement. An eligible employee who is the spouse, son, daughter, parent, or next of kin of a covered service member who is recovering
from a serious illness or injury sustained in the line of duty on active
duty is entitled to up to 26 weeks of leave in a single 12-month period to
care for the service member. This provision became effective immediately
upon enactment. This military caregiver leave is available during “a single
12-month period” during which an eligible employee is entitled to a combined
total of 26 weeks of all types of FMLA leave.
SEC. 102. LEAVE REQUIREMENT
Tools, Resources and Posting
Information on the amendments and a version of Title I of the FMLA with the new statutory language incorporated are available on the FMLA amendments. Additional references about the National Defense Authorization Act for FY 2008 is available at NDAA.
Although Texas is an "at-will"
employment state, there are several issues to consider
if an employer decides to terminate a worker. While
"at-will" means good cause or notice is not
needed, an employee cannot be fired for discriminatory
reasons. Written, implied oral or express contracts
negate the "at-will" doctrine. Avoiding an
unemployment chargeback to the employer's tax account
dictates documentation of misconduct to show good cause
for firing an employee.
A good company handbook is an invaluable
aid in the discipline process. It can deflect discipline
problems by clearly communicating company policies and
procedures. It is difficult to prove that employees
violated rules if it cannot be proven they were informed
of them. Employees should sign off on a handbook to
acknowledge that they have read, understood, and agree
to be bound by company rules and regulations, and that
failure to do so can lead to discipline up to and including
Documentation of discipline problems needs
to be in writing. Do not put anything in a personnel
file that could not stand up to a jury's scrutiny. Be
factual, objective and fair. Follow a progressive discipline
program (except in cases of serious criminal activity)
that is outlined in the company handbook.
No federal or state law exists that requires
a certain number of written warnings. Employers can
determine their own policy. If an employee is in danger
of being terminated, give a written statement that says,
"Your job is in jeopardy." Ask that it be
signed. If an employee refuses to sign, write on the
document that a job in jeopardy warning was given, the
date, and a statement that the recipient understands
his job is in jeopardy even though he refuses to sign.
In this situation, it is best to have a company witness
present at the disciplinary counseling meeting.
Workforce Solutions has compiled a number of tips and resources for local employers regarding pay and policy issues. These excerpts are gathered from the Especially for Texas Employers handbook, published as a service to the employers of Texas by the office of the Commissioner representing employers on the Texas Workforce Commission, under the authority of Texas Labor Code Section 301.002(a)(2).
To download, click here to fill out a brief registration form. The information you provide will not be shared with any outside vendor or third party.
For more information on workplace issues, labor policies, or to obtain a free copy of the “Especially for Texas Employers” handbook contact:
Workforce Solutions — Employer Services at 713-688-6890 or e-mail email@example.com
CLAIM AND APPEAL PROCESS
The Texas Workforce Commission holds responsibility
for the state unemployment compensation program. Below
is a brief outline of the unemployment claim and appeal
process, in order of occurrence.
Claim: Once an employee is no longer working, a "work
separation" occurs and the worker may file an initial
claim for unemployment benefits. If the claimant is out
of work due to no fault of his own, and otherwise eligible,
benefits are payable.
- Immediately after the initial filing,
TWC mails a notice of the initial claim, a "notice
of application for unemployment benefits," to
the organization or individual listed as the "last
employing unit" where the claimant last worked
- The employer has 14 calendar days to
file a timely written response to make itself a "party
of interest" with appeal rights.
- Claim responses may be filed by mail,
fax, telephone, or by TWC's Internet claim.
Determination: TWC makes an initial determination,
a "determination on payment of unemployment benefits,"
and mails copies of the decision to all interested parties.
If the employer filed a late response to the initial claim,
the determination is a "late protest" ruling.
- In any case of a "late protest"
ruling, the employer should allege the problem was
outside its power of control as the reason for an
untimely protest, if it wishes a hearing on the underlying
merits of the unemployment claim.
- If the employer filed no response and
the claimant draws benefits, the employer receives
a notice of maximum potential chargeback, a "wage
- No matter which form the initial determination
takes for the employer, the employer should file a
written appeal and request for a hearing within 14
calendar days of the date TWC mails the ruling.
Tribunal: Once an appeal has been filed, the Appeals
Department dismisses the appeal, issues an on-the-record
decision, or sets up an appeal hearing.
- This appeal is dismissed if it is filed
outside the 14-day appeal period.
- If the employer fails to disagree that
it filed a late protest to an initial claim notice,
an on-the-record decision is issued affirming the
fact of a late protest.
- In all other cases, the Appeals Department
mails notices of an appeal hearing to the claimant,
the employer, and any representatives they may have
- Appeals hearings are usually held by
telephone. The employer should act as if this is the
only chance to explain its side of the situation.
- In general, firsthand testimony from
witnesses with direct, personal knowledge of the events
leading to the claimant's work separation takes precedence
over all other forms of evidence.
- Documentary evidence may be entered
- When a hearing is by phone, the employer
must send copies of any exhibits to both the hearing
officer and the claimant.
- Failure to send copies to the claimant
may result in the hearing officer refusing the items
- All parties may offer direct testimony,
conduct cross-examination, and make concluding statements.
- Usually within one calendar week, the
hearing officer issues a written decision either affirming,
reversing, or modifying the determination which was
Appeal: The three-member Commission board, appointed
by the Governor for staggered six-year terms, heads The
Texas Workforce Commission. The chairperson of the board
represents the public at large, one commissioner represents
employers and the other commissioner represents labor.
The Commissioners are the highest authority within TWC
in deciding an unemployment appeal.
- Any party may appeal an adverse Appeal
Tribunal decision to the three-member Commission.
- An appeal must be done in writing within
14 calendar days of the date the hearing officer mails
a decision or it will not be considered.
- The Commission affirms, reverses or
modifies the Appeal Tribunal decision. It may also
order a further hearing.
- Action on appeals occurs in a weekly
docket meeting where the Commissioners cast their
votes. They do not take testimony from the affected
parties, but may consider relevant written materials
submitted after the hearing.
- In such a case, the Commission orders
a rehearing to officially admit the new evidence into
- All three Commissioners sign the Commission's
written decision. The losing party may either file
a motion for a rehearing or an appeal to a court.
for Rehearing: The final stage of the administrative
appeal process is this motion, which must be filed in
writing within 14 calendar days of the date the original
Commission decision is mailed.
- To grant a rehearing, the motion must
offer new evidence, give a compelling reason why the
evidence could not have been offered earlier, and
show specifically how it could change the outcome
of the case.
- If the Commission denies the motion,
a written decision is mailed to each party that can
be appealed to a court.
Appeal: A Commission decision is final 14 calendar
days from the date it is mailed.
- After the Commission decision is final,
the losing party may file a court appeal within 14
- Therefore, the court appeal period
is between the 15th and 28th calendar days following
the last Commission decision mailing date.
- Because the standard of review is the
"substantial evidence rule," there is no
right to a jury trial in an unemployment compensation
case. The law provides for a trial de novo and the
parties may present their entire case again for the
- The judge decides as a matter of law
whether substantial evidence exists to uphold the
- The court's decision may be further
appealed as in any other civil case.
Needed for a UI Claim and/or Appeal: While different
situations require different evidence, some types of evidence
are always required, no matter the cause of the claimant's
work separation. These types are:
- Firsthand testimony from witnesses
with direct, personal knowledge of the events leading
to the claimant's work separation, i.e. "the
ones who saw it happen"
- Documentation of policies, warnings,
attendance, or any other subjects relating to the
claimant's work separation
- In a discharge case, evidence relating
to a specific act of misconduct that happened close
in time to the discharge, i.e., the event that precipitated
- In a resignation case, evidence relating
to whatever motivated the claimant to resign