Management
The Impact of the New Alternative Work Schedule on Dental Offices
Bette E. Robin, DDS, JD
Copyright 2001 Journal of the California Dental Association.
Dr. Robin will present "Protect Yourself and Your Dental Practice" at CDA’s Spring Scientific Session in Anaheim, Calif. The presentation will be held from 9:30 a.m. to 12:30 p.m. on Sunday, April 22, in Ballroom C of the Anaheim Convention Center.
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Wage Orders 2000 and 2001 substantially changed the way the alternate work schedules used in many dental offices may be structured to avoid the payment of daily overtime. |
The daily payment of overtime compensation to employees is a source of great confusion to many dentists. Most dentists want to properly compensate their employees, not only out of a sense of fairness, but also to avoid the substantial legal liability that may result from improper compensation. Determining correct compensation can be difficult at best, especially with the seemingly ever-changing laws. Those who think they have it right, probably do not. Even if they did at one time, the law has probably changed since then. This article is a review of the current daily overtime compensation requirements for dental offices and the potential use of alternate work schedules to avoid some of that overtime. This article does not constitute specific legal advice, and appropriate legal professionals should be consulted in the event a dentist wants to make changes in his or her current compensation scheme.
Overtime/Alternate Work Arrangement Review
California Gov. Gray Davis signed the Eight Hour Day Restoration and Workplace Flexibility Act of 1999 in July of 1999 and it took effect on Jan. 1, 2000.1 One of the act’s main purposes was to provide for daily overtime. Simply, it requires that employers pay employees overtime at time and a half for hours worked over eight in a single work day or over 40 in a single work week.2 To facilitate this new regulation, interim wage orders were adopted that amended the state’s labor codes and the alternate work schedule. Most practical uses of an alternate work schedule by the practicing dentist were effectively abolished. The interim wage orders seemed to require an employer to "guarantee" an employee all the hours stated on that employee’s alternate work schedule. That is, the employer-dentist had to pay all 10 hours every day, regardless of whether those hours were actually worked under the interim wage orders.
Since that date, the Labor Commission in California has gone through a tortuous path in attempting to clarify and define the new regulations, including the alternate work schedule. A great deal of input was considered from both employer and employee groups. On June 30, 2000, at a public hearing of the Industrial Welfare Commission, the interim wage orders were amended, and 1989 wage orders were temporarily reinstated except where the 1989 wage orders were superseded by other interim wage orders or later amendments. As might be expected, more confusion resulted.
On Oct. 1, 2000, the Labor Commissioner implemented permanent regulations in the form of the Wage Order 2000, which again amended the relevant provisions of the Labor Code. Wage Order 2000 is largely the regulation Davis intended in his act of July 1999, however some concessions were made to employer groups, including concessions in regard to the hotly debated alternate work schedule. On Jan. 1, 2001, Wage Order 2001 went into effect, making additional changes to the law. The alternate work schedule provided for in the 2001 Wage Order is different from all old schedules dental offices may have had.
Who the Overtime Law Applies To
Wage Order 2001 applies to all employers, regardless of size.3 That is, even if an office has just one employee, daily overtime must be paid on all hours worked over eight in a single work day or over 40 in a single work week.4 All steps for implementation of an alternate work schedule must be strictly followed. There are no different requirements or exceptions for small offices as there are with some other employment laws.
What the Overtime Law Requires
Wage Order 2001 requires the payment of overtime at 1 1/2 times the regular rate of pay to all non-exempt employees on all hours worked over eight in a single work day or over 40 in a single work week. A very limited exception allows the work day to be extended to 10 hours by the implementation of an alternate work schedule.5
Requirements of an Alternate Work Schedule Under Wage Order 2001
The alternate work schedule allows the payment of straight time for hours worked up to 10 in a single work day after the proper implementation of that schedule and reporting to the state of California.6
The drastic difference from previous alternate or flexible work schedules occurs when employees with 10-hour alternate schedules are requested to work less than 10 hours during a single work day. The new laws state that the employer must allow the employee to work all the hours on that employee’s individual schedule and compensate the employee for that work at straight time or must pay overtime to that employee for all hours worked over eight in the work day.7 That is, the dentist must elect from the two choices described above in compensating their employees for work over eight hours in a single work day.8
As an example, if an employee is scheduled to work 10 hours in a single work day and the dentist asks that employee to go home after 8 1/2 hours, the dentist would have the option of paying the 10 hours of straight time (that is, the 10 hours on that employee’s work schedule) or paying the employee straight time for eight hours and 1/2 hour of overtime compensation at 1 1/2 times the employee’s regular rate of pay. Dentists should be aware that they must select one of the options. Again, this is different from previous alternate or flexible work schedules.
For dentists whose work schedules are regular and planned, a properly implemented alternate work schedule can provide substantial financial relief from the daily overtime requirement. But for many offices, the alternate work schedule is no longer a practical solution and overtime hours should be minimized and paid as required.
How to Implement An Alternate Work Schedule
In the event a dentist determines it is in the practice’s best financial interest to implement an alternate work schedule under the new laws, he or she must determine whether it is advantageous to have all the affected employees vote on the alternate work schedule or whether it would be better to separate the practice into job units. That is, dentists may elect to have their dental assistants on an alternate work schedule and their front desk personnel on a traditional work schedule. Front and back office job positions may be considered to be separate work units. One person may constitute an entire unit.
Once it has been determined which job positions would work best on an alternate work schedule, it must be determined which employees in these job positions would be affected by the implementation of an alternate work schedule. Only affected employees are eligible to vote.9 An employee whose job is unaffected by the overtime requirements will not be eligible to vote. For example, part-time employees are usually not affected, nor are any employees who routinely work less than eight hours in a work day.
Next, the dentist must hold a disclosure meeting for affected employees and provide them with written information as to how the alternate work schedule would apply to them and affect their compensation. No day on an employee’s work schedule may be less than four hours.10 This must be done at least 14 days before the employees will be asked to vote by secret ballot.11 Each employee must be provided with his or her own personal alternate work schedule, or a menu of schedules, from which the employee may choose.12 This disclosure meeting must be called for the specific and only purpose of discussing the effects of implementing an alternate work schedule.13 No other business may be discussed.
Employees should be told they will be asked to vote in about two weeks on whether to implement the alternate work schedule. Employees must clearly understand exactly what their new schedule will be and what their schedule will mean to them in terms of their compensation. Dentists should let employees know that they are willing to discuss any questions during the period prior to the vote.
On the voting day, a brief meeting should be held to review the meaning of the alternate work schedule. Then, employees should be asked to vote secretly as to whether to implement the alternate work schedule.14 Balloting must be anonymous. No specific format must be used.
In the event that at least a two-thirds majority vote is obtained in each work unit or in the entire office, the schedule has been approved.15 Each affected employee must then sign a written statement indicating agreement with the schedule. An alternate work schedule is now legally in place.
Labor Code section 511(e) then requires the employer to report the result of the balloting to the California Division of Labor Statistics and Research within 30 days of the balloting. To comply with this requirement, the dentist must send to the state, on his or her letterhead, the following information:
* The dentist’s name;
* The date of the balloting;
* The results of the balloting; and
* The number of employees in the practice.
This information must be mailed return receipt to: State of California, Division of Labor Statistics and Research, P.O. Box 420603, San Francisco, CA 94142-0603.
Other Requirements Under Wage Order 2001 Alternate Work Schedule
There are numerous other requirements under the alternate work schedule that may affect some offices. For example: An employer must provide all of the above-mentioned disclosures in non-English language(s) if more than five percent of the staff speak primarily that non-English language. An employer must also reasonably accommodate an employee’s religious beliefs and request not to work an alternate schedule when formulating that employee’s individual work schedule.16 Note that a dentist may not punish or threaten to punish an employee in any way for failing to adopt an alternate work schedule or appeal an alternate work schedule.17
"Comp time" off is once again allowed under the Wage Order 2000 alternate work schedule. The requirements for use are strict but sometimes practical for the dental office. First, the employee must make a written, signed request to take time off for personal obligations and request to make that time up.18 Every request for such time off must be in writing.19 The time must be made up in the same work week and the hours worked on the make-up day must not exceed 11.20 The dentist employer may not encourage or solicit an employee to utilize comp time to meet the practice’s schedule or for any other reason.21
The Grandfather Clause
The 2000 Wage Orders contain a grandfather provision that allowed employers that had legally adopted an alternate work schedule prior to 1998 to continue working that schedule if: 1) The employer has the secret ballots, the individual signed and dated disclosure statements, and the individual signed and dated agreement to work the alternate work schedule in their possession, regardless, it seems, whether or not any of the same employees are still in the dentist’s employ and, 2) the employer reported the election, the date of the election, the final tally of the vote, the total number of affected employees, and the nature of the employer’s business to the Division of Labor Statistics and Research before Jan. 1, 2001.
Failure to Comply
Employers that knowingly or unknowingly deny their employees proper compensation, including proper payment of overtime, subject themselves to several different avenues of redress by employees. Federal law allows employees to sue for attorney’s fees;22 sue for double the amount of the claim through liquidated damages;23 and sue for interest, penalties, and damages. California state law allows for a specific legal action for failure to properly pay.24 Employees may also sue under broader sections of California’s Business and Professions Code for unlawful employment practices.25
Employers must not turn a blind eye to overtime worked, even though it may not be recorded by employees.26 All overtime worked must be compensated, regardless of whether the employee requests the compensation or records the time accurately. Doctors must enforce and monitor the proper keeping of time records, as required by law.27
Conclusion
This author believes that the alternate work schedule exception to the daily payment of overtime to employees is not feasible for use by most dental offices in its presently mandated form and that the schedule may be improperly utilized by many offices potentially subjecting the dentist-employer to substantial penalties.
Author
Bette E. Robin, DDS, JD, has a law practice focused on practice transitions, employment law and general business concerns of the health care practitioner.
References
1. Eight Hour Pay Restoration and Workplace Flexibility Act of 1999, AB 60, 1999 Cal. Stat. ch. 134 (codified at Lab. Code sections 500 et seq.) (effective Jan. 1, 2000)
2. Lab. Code §510(a).
3. Lab. Code §510.
4. Lab. Code §§ 510(a).
5. Lab. Code §510(a)(1).
6. Lab. Code §511.
7. Wage Order 4-2001, (3) (B) (2).
8. Ibid.
9. Wage Order 4-2001, (3) (C) (6).
10. Wage Order 4-2001, (3) (B) (8) (c).
11. Lab. Code §511(a).
12. Wage Order 4-2001, (3) (C) (1).
13. Wage Order 4-2001, (3) (C) (3).
14. Lab. Code §511.
15. Wage Order 4-2001, (3) (C) (2).
16. Wage Order 4-2001, (3) (C) (3).
17. Lab. Code §511(c), (7).
18. Wage Order 4-2001, (3) (M).
19. Ibid.
20. Ibid.
21. Ibid.
22. U.S.C § 216(c).
23. Ibid.
24. Lab. Code §1194.
25. B & P Code §17200.
26. 29C.F.R. §785.11, §785.13.
27. Lab. Code §1174(d).
To request a printed copy of this article, please contact: Bette E. Robin, DDS, JD, 330 W. Badillo St., Covina, CA 91723 or at Betrobin@aol.com.
