We are a healthcare facility located in NJ.  We are changing our lunch period from 30 minutes "paid" to 30 minutes "unpaid." We would like to require employees to stay on the premises. They will not have to "clock" out; but we will automatically deduct 30 minutes per day for any hours worked over five (5).  I have searched the NJ statutes and can not find any lanquage regarding this especially if it's okay to require them to stay on the premises!  Help!!!

When you are not paying someone, you really don't have much control over them. This is more of a Fair Labor Standards Act issue than it is a state meal/break time issue.  Essentially, you are saying that you want your employees to be off the clock but "on call".

Whether or not you have to pay someone who is "on call" or not has a lot to do with what restrictions you place on them during this period of availability.  Telling them they have to be at the worksite means you have to pay them: it's too restrictive.  Most things that will accomplish what you probably want are also too restrictive to go unpaid.

The other issue here is that if you automatically deduct 30 minutes and a person gets called off break and it's not reported/documented or an employee works through their break and doesn't let anybody know, it's still the Company's responsibility to know that and pay the person for that off-clock labor.  There are companies that do this, it's not unheard of, but you need to know the exposure side of it, too.  Everything's fine until you fire someone and they make a wage and hour claim against the Company and claim they were forced to work off the clock during their break.  It becomes a mess pretty fast.

TXHRGuy makes some great points.  I don't think it is advisable for you to require your employees to stay on site during unpaid breaks.  If they are not clocking out or otherwise recording these breaks, you will also need to figure out a way to determine if someone did work during those 30 minutes.  Will you have some sort of person responsible for monitoring the coming and going of your staff?  I think automatically deducting 30 minutes without back up documentation really does open you up to unnecessary liability. 

I agree with the others that I don't think this is a good idea.  Since you would have automatic deductions the burden of proof is going to be on you to prove that the employee did in fact take lunch and you should not pay them for that time.  I suspect you are going to have a hard enough time changing from the 30 min paid to 30 min unpaid, that saying you must stay on the premise is only going to add to your moral problems. 

Thank you all for responding and I definitely understand about the burden of proof!  The main reason we have them stay on the premises or on the "campus" is because there is no place to eat within 10-15 minutes of our location.  They can eat in our cafeteria or leave the building, walk around the grounds, visit others, etc.  They are completely relieved of their duties and not "on call." 

The main reason we do the automatic 30 minute deduction is so we don't have to monitor 300+ employees clocking in and out, If we did that, we would have to run reports to see "who did what" and discpline those who were late, didn't clock in or out, etc.  What a nightmare!!!! 

I've looked in the Wage and Hours regs for NJ and can't find anything addressing this. 

Check out http://www.dol.gov/esa/whd/opinion/FLSANA/2007/2007_05_14_01NA_FLSA.pdf

There are a lot of caveats to doing an automatic deduction.  I wonder if you wouldn't have more exceptions than you would expect.  Which will turn into a larger nightmare then having them all clock in and out.

I suspect these issues are one of the main reasons that the employer was paying the lunch break anyway.

Here's a good article from 2005 from AHI Publications that does a great job explaining the DOL's POV on the staying on the premises issue: http://www.ahipubs.com/singleissue/2006/mlbnlnov105.html

 

 

I understand what you are talking about monitoring 300 people clocking in and out but think of something first.  That nightmare will be nothing compared to what you will deal with if you end up with a wage and hour lawsuit with other employees jumping on the bandwagon saying you automatically deducted time from them and they were in fact working.  I had 250 people at one location of my previous company.  It was a "nightmare" at first but we did training, retraining and disciplined those that did not follow the procedure.  To us it was worth all this "nightmare" time because in this particular state there had been some recent well known wage and hour claims that employers had lost each one.  One thing we did was install time clocks all over the building so that employees had many to choose from during the "lunch rush" times. 

I am not familiar with NJ but I would look at the state wage and hour cases as well as cases in the your circuit.  I am in MD and we have some cases that were just decided that are playing havec with our wage and hour laws.  The highest court in MD made a decision that doesn't come right out and say that the laws can be interpreted in a different way but many attorneys in the state are warning employers that the descision could have lasting ramifications. The state legislature just passed a bill to help clarify how the law should be interpreted, but something tells me that this is not going to be the last we hear about this. 

Deldra:

They are completely relieved of their duties and not "on call." 

Technically, under the law, they are "on call" because you wont let them leave.  "On call" simply means that the employee is not completely free of obligation to the company during a period of time, during which they are typically not paid.  Or, worse, they are simply on uncompensated work time.  you can't control their movement and not pay them.  If someone wants to go through a drive through and eat in the car on the way back, your policy would prevent that. and that means you have to pay them if you want them to stay.  There's something called "waiting time" that also applies here.  When you tell someone that they have to be at work, there's a difference between being engaged to wait and waiting to be engaged.  In either case, I don't think that the Company's purpose will be well received by the department of labor.  Consider also that people do things on lunch that aren't always about eating.  They could involve going to the bank, paying a bill, or desiring to eat outside in a local park.

Here's a fact sheet with an undetailed view of several of the FLSA hangups: http://www.dol.gov/esa/regs/compliance/whd/whdfs22.pdf 

See also the DOL hours worked advisor: http://www.dol.gov/elaws/esa/flsa/hoursworked/screen1d.asp  and, later, click on "off duty time"

I think that you will see that your employees may well not be off duty (i.e., they must be compensated) merely because they cannot use the time as they choose for their own purposes. see also http://www.dol.gov/elaws/esa/flsa/hoursworked/screenER79.asp

Ultimately, the tests for being "on call" or "waiting to be engaged" are more complicated than that and this is not a simple matter.  I predict that you will ultimately end up with someone on the verge of termination for performance who will end up making a wage claim.

29CFR 785.16 (a):
"(a) General. Periods during which an employee is completely relieved from duty and which are long enough to enable him to use the time
effectively for his own purposes are not hours worked. He is not completely relieved from duty and cannot use the time effectively for
his own purposes unless he is definitely told in advance that he may leave the job and that he will not have to commence work until a
definitely specified hour has arrived. Whether the time is long enough to enable him to use the time effectively for his own purposes depends
upon all of the facts and circumstances of the case."

Deldra:

The main reason we do the automatic 30 minute deduction is so we don't have to monitor 300+ employees clocking in and out, If we did that, we would have to run reports to see "who did what" and discpline those who were late, didn't clock in or out, etc.  What a nightmare!!!!

Unfortunately, the law requires you to monitor your employees' paid time.  Just understand that you are assuming that every supervisor and every manager knows who is working and who is not and, specifically, that people are not working for 1 full uninterupted 30 minute block of time or some reasonable division thereof that comports with NJ law (e.g., 3x 10 minute breaks if that's allowed).

"It is the duty of management to exercise control and see that work is not performed if the employer does not want it to be performed." from the hours worked advisor.

Deldra:

I've looked in the Wage and Hours regs for NJ and can't find anything addressing this.

I don't see a meal/break law for New Jersey in any of my typical resources.  So, assuming there is no law governing the break itself, it remains that there's no doubt that there is a clear FLSA concern regarding the restriction of mobility placed on your employees that may turn out to be a wage and hour violation.  There is also the exposure to wage and hour claims through undocumented break time.

Before you move ahead with this, I suggest you research FLSA outcomes in your circuit with respect to "waiting time" and "on call time" or consult with an employment law attorney familliar with the state and circuit in which the facility is located.

I think my recommendation would be to pay them for the 30 minutes if they stay on-site and have them clock in and out if they actually leave the premises.

To me, unpaid lunch means it's your time to do as you please.

Agreed.  I was part of a large NJ employer and experienced a few DOL audits.  If you require them to stay, then you need to count that as compensable time.  The potential liability is not worth the initial cost-savings of reduced labor hours.  There are other, more acceptable, alternatives that could provide you similar cost reductions (such as flex & alternative schedules).