South Florida Hospital News
Thursday December 14, 2017
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November 2017 - Volume 14 - Issue 5

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The Importance of Employee Recordkeeping

Former Secretary of Defense, Donald Rumsfeld, once said, “Simply because you do not have evidence that something exists does not mean that you have evidence that it doesn't exist.” Unfortunately for employers, not having employment records of employees is often held against employers in Court and may be sufficient “proof” of violation of the wage and hour laws.

Many physicians treat their practices as family businesses – they trust that the employees whom they treat fairly, would not turn against them at the first opportune moment, such as following a layoff or an office dispute. This results in neglect, failure to keep records, or keeping imprecise employee records, which, oddly, stands in complete contrast with the manner in which physicians are trained to practice medicine – by keeping exact records of all medical transactions. While somewhat understandable, the habit of not keeping precise and complete records potentially jeopardizes not only the financial well-being of the medical practice, but even the physician’s own personal finances. That is because employers are often defined by employment statutes to include, individually, those responsible for employment-related decisions, regardless of the protections afforded by incorporation.
 
In employee wage litigation, the burden of proving damages by producing specific evidence, is on the employee/claimant. That means that the employee has to prove his or her claim. Employees must be able to demonstrate, precisely, how many hours they worked, and exactly what damages they are owed. However, when employee records are incomplete, the U.S. Department of Labor regulations and controlling case law relax the burden placed on the employee and allow a presumption of truth in favor of a claimant’s testimony even if it is completely unsupported by any additional evidence. The burden, then, turns to the employer to rebut the presumption through records (which do not exist) and often results in jury verdicts in favor of the employees/claimants.
 
Conversely, keeping complete and accurate records commands a presumption of truthfulness of those records, which can be negated only by evidence of inaccuracy. If a claimant is unable to demonstrate the inaccuracy of the records, those claims often result in summary judgment decisions in favor of the employer. To summarize, when complete and accurate records are present, an employee has the burden to disprove them; however, when records are not present or when records are incomplete or inaccurate, the employer must disprove a claimant’s claim. Given this dramatic discrepancy in burdens, it is clear that the best way to prepare for, and prevail against employee wage claims is by having complete and precise records of the employee’s terms of employment.
 
What records are required? The Department of Labor requires employers to keep records on each employee’s hours and wages as well as other information that is regulated by the Department of Labor. While there should be documentation of this required information, there is no requirement that employers keep a time clock. It is important that employers maintain the following records:
• personal and basic information about the employee like address and birthdate;
• total hours worked each workday and each workweek, which includes the time in and time out and any bona-fide break for which a deduction is made;
• total workweek straight-time earnings;
• total workweek overtime-time earnings, if any;
• regular hourly pay rate;
• overtime hourly pay rate, if applicable;
• deductions from or additions to wages;
• total wages paid each pay period;
• date workweek is commenced; and
• date of payment and pay period covered.
 
Record keeping as an employer is important not only to comply with overtime requirements but also Department of Labor regulations. Hour and Wage records can also assist in defending against an FLSA overtime claim. Record keeping does vary among different employees particularly if they are exempt salaried employees like managers.

For particular questions regarding your specific situation and to ensure compliance with regulations, please contact Adi Amit, Partner at Lubell Rosen, at (954) 880-9500 or Adi@lubellrosen.com.

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