Expert: Thomas R. Ballas - 10/27/2009

Question
I have a manager and 6 employees at a remote site for a US Govt contract.  We currently do not use a time clock, but I have been getting unconfirmed reports from my most important customer about my employees being late for work, including complaints about my manager.  Therefore, I am considering installing a timecard system.  My question is regarding overtime, which I am not authorized to bill under this USG contract.  If my employees clock in early and/or late resulting in an excess of 40 hours for the week, am I required by law to pay them overtime?  Or can I simply use the system as an accounting method to ensure they arrive at work on time and don't depart early?
Thanks,
Tom

Answer
Tom:

It does not matter how you keep employees time, what matters is that you pay them for all time worked.  I would put in the time card system to insure they report on time and end work on time. You control this with instructions to the employees that state they must not start work before the start time, and should not work beyond the quit time, without authorization.  

If they do not follow instructions, you can discipline them.  That said, it you know they work early or late, you must pay them for all time worked, even if you cannot bill under the contract.

The law says you must pay for all time worked, and must pay for overtime if worked.

Hope this helps.

Tom Ballas