Employees often call us about the legality of day rates – when a company pays a flat rate per day, rather than by the hour – and whether they affect a worker’s right to overtime pay. Although day rates occur in almost any industry, they are especially common for construction workers, often on worksites working far longer than an eight hour nine to five. Read on to find out more about what your overtime rights are in the construction industry, or any other employer who pays a day rate.
The idea of a day rate is simple. Rather than track specific employee hours, a company will simply pay a set rate for every “day” of work – no matter how long, or how short that day might be. This can be perfectly legal, if used properly. But companies can very easily abuse the day rate system to avoid paying overtime. Most commonly, companies will set a day rate based on an assumed eight hours of work, then require workers to stay longer or “until the job is done” without any additional payment.
Even under a day rate pay plan, companies must pay time and a half pay for all hours worked past forty in a week. In other words, companies must pay an additional overtime premium, on top of the day rate, to anyone who works over forty hours. Many companies skirt this law, or simply do not understand it. Over weeks, months, or years, this lost overtime pay can add up to serious money – money which you may have the legal right to recover. What’s more, courts can order employers to pay liquidated damages, a legal penalty that doubles the settlement amount for unpaid overtime. As a result, it’s not uncommon for construction workers to recover thousands or tens of thousands of dollars for unpaid overtime in day rate cases. Of course, every case stands on its own, and the final number will depend entirely on each worker’s individual pay rate and number of overtime hours actually worked.
Companies will sometimes say “the overtime is built into the day rate.” But that is not what the law requires. Even if a company sets a day rate based on ten hours of work, rather than eight, it still has not taken into account the overtime time-and-a-half pay. Overtime calculations can be tricky in day rate cases, and attorneys who specialize in this area may be able to help you figure out whether any overtime is owed. (As with any law, there are certain exemptions and exceptions.)
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Penalties for unpaid overtime can include back wages, statutory penalties, and attorneys fees. If you believe you have been shorted your earned pay, click here to contact New Orleans overtime lawyer Charles Stiegler today, or call (504) 267-0777. The consultation is free. This is your money, you have worked for it, and you have earned it. We may be able to help you get it back.