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Lawsuit: employer avoided overtime pay with 'ghost timecards'

Under both federal and Wisconsin state laws, workers must be paid one and one-half times their regular rate of pay for all hours worked in excess of 40 per week. There are a few industries or professions that are exempt from the right to overtime, but the majority of workers here in Wisconsin have a right to time and a half if they are putting in 40-plus hours on the job.

Unfortunately, some employers use all kinds of tricks in order to avoid paying workers the lawful overtime rate. These tactics include misclassifying workers as exempt, paying workers cash for extra hours at straight-time, and various intimidation measures. One maintenance company that staffs retail stores with cleaning crews throughout the Midwest was recently accused of using what are known as 'ghost timecards' in order to cheat workers out of overtime pay.

According to a class action lawsuit, in order to manipulate pay rates and avoid paying workers time-and-a-half, workers were reportedly asked to list some of their hours on a timecard other than their own. They put their normal hours on a timecard in their name, and the extra hours on a nonexistent employee's timecard. The employees then received their normal paycheck that corresponded with the timecard in their names, and the ghost workers' checks were cashed and the wages were then paid out to the employees in straight-time.

The cleaning company has denied the accusations and suggested that perhaps one supervisor inappropriately misadvised workers into using ghost timecards. Even if this is what happened, the employer still may be held responsible for back wages.

This particular company has reportedly been sued several times around the country for labor law violations. The stores that the contractor staffs--Target, Sears, Best Buy and Kmart, among others--have not been targeted in the lawsuit.

Workers who have experienced wage theft have a right to hold the employer accountable and seek back wages whether or not the wage theft was a result of an explicit company policy. There are a variety of ways that employers may attempt to evade wage and overtime laws and this does not have to be tolerated.

Source: Business Week, "Did Florida-based company avoid paying overtime? A dozen Minnesota cleaners say yes," John Welbes, Nov. 5, 2012

  • More information about employment law and employee rights is available on our Milwaukee law firm's Employment Law website.

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