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Overtime v. Comp Time: Why Banking Hours is Wrong for your Household Employee

Posted by HomeWork Solutions on 5/2/17 4:41 PM
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When you’ve found a household employee that you and your family loves and trusts, it’s a wonderful feeling. Soon, you can start relying on this person to take care of things in your absence. But, if this means that you start asking for them to work more hours during the week or on the weekends, you should know the facts about overtime versus banking hours.

Overtime v. Comp Time- Why Banking Hours is Wrong (1).pngThe facts:

Banking hours, or carrying your nanny’s hours over, is illegal. Federal wage and hour laws require that your household employee is paid for every hour they work during the workweek. If there are hours that are worked in excess of 40 during a workweek, you are required to pay them at an overtime rate of at least 1.5 times their regular rate of pay. The purpose of these laws are so employers cannot carry over hours from week to week in order to get out of paying overtime. State laws may vary slightly, so read more here for additional information. And always the more adventageous to the employee of federal and state rules is what applies.

Other important facts:

Whether or not your household employee is entitled to state or federal overtime benefits will depend on what the job duties and details of the job are, such as whether they live in or out of it. As the employer, you will need to do the research as to what your employee is entitled to by law so you can cover all of your bases.

If you fail to pay overtime and were required to do so, this could be a devastating mistake. There are hefty fines and other penalties that are attached to failure to follow overtime laws, so be sure that you have all of the information you need from the very beginning. The US Department of Labor and state wage and hour board work together to educate workers and facilitate their complaints. The burden of proof lies with the employer, so keeping accurate and contemporaneous time tracking records is a must. Plan ahead by talking to a household payroll specialist so you can avoid confusion on banking hours versus overtime. This will help you avoid frustration with your nanny and/or other expensive errors down the road. Contact us today for more information.

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Topics: overtime rules, nanny overtime

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