Compliance with state wage and hour laws is on the forefront of the mind of just about every employer, particularly as employees are looking for more flexibility in their work schedules since the pandemic. Ogletree Deakins’ recent survey report, Strategies and Benchmarks for the Workplace: Ogletree’s Survey of Key Decision-Makers, revealed that state wage and hour laws are the second most challenging area of multi-jurisdictional compliance.
Employees are seeking ways to maintain the flexibility with their work schedules that they may have experienced while working remotely during the pandemic. Employers may be tempted to move toward flexible vacation or paid time off (PTO) policies, where employees are allowed to take unlimited time off with certain parameters.
But before transitioning to an unlimited PTO policy, employers may want to consider these four questions.
1. What Is the Benefit of Unlimited PTO Policies?
The benefit of an unlimited PTO policy is that once the employer makes the transition, employees will no longer have accrual of PTO time or banks with PTO balances. Thus, there is no unused PTO that has to be forfeited or carried over at the end of the year and no unused balance to pay out at termination. This can make multistate wage and hour compliance administratively easier. The key is making the transition from you current plan to the unlimited PTO plan in compliance with all applicable state laws. Even under their traditional PTO policy, a number of...
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