As an employer, you need to make payroll and you need to pay your employees properly. Balancing these obligations can get complicated, but effectively managing your employees’ regular and overtime hours can go a long way in staying on budget and being a good employer. Learning what employers should know about the Wage and Hour Law in Maryland can help keep you out of trouble and your finances in the black.
What Is the Wage and Hour Law in Maryland?
Maryland’s overtime law requires employers to pay their employees an increased rate for hour worked in excess of 40 in a week.
When Does an Employer Have to Pay Overtime?
In general, an employer pays overtime whenever an employee works more than 40 hours in a seven-day period. The number of hours that trigger an overtime obligation can change under Maryland law, depending on the job the employee works. The application of Maryland overtime law changes according to the following jobs and circumstances:
- Employees of bowling alleys don’t have the right to receive overtime pay until they’ve worked more than 48 hours in a week;
- Employees who provide on-premise care (outside of hospitals) for the elderly, ill, or disabled don’t have the right to receive overtime pay until they’ve worked more than 48 hours in a week; and
- Agricultural employees don’t have the right to receive overtime pay until they’ve worked more than 60 hours in a week.
If your business provides multiple services performed by different employees, you need to keep your overtime obligations toward each category of employee very clear.
How Much Do You Pay for Overtime Work?
You pay employees one-and-one-half times their regular pay rate for any hours they work over 40 in a week (or 48 or 60, depending on classification). In general, employees are entitled to overtime pay regardless of whether they are hourly or salaried employees.
Maryland Overtime Exemptions
There are some employees who aren’t entitled to overtime pay under Maryland law, and you need to know who they are. Employees who don’t get overtime in Maryland include:
- Employees who are the employer’s immediate family members;
- Some agricultural employees;
- Employees in outside sales;
- Administrative employees;
- Professional employees;
- Employees who receive commission;
- Employees for drive-in theaters;
- Educational, charitable, religious, or non-profit organization volunteers;
- Certain non-profit concert promoters for the arts;
- Certain employees who sell or service automobiles or equipment;
- Certain employees involved in selling, canning, packing, or freezing food items;
- Employees who are less than 16 years old and work less than 20 hours per week;
- Organized camp employees who aren’t administrators;
- Employee trainees in public school education programs;
- Taxi drivers;
- Employees subject to certain federal motor carrier and interstate commerce laws and regulations; and
- Certain seasonal recreation and amusement employees.
Also, a Maryland employer generally can’t ask a nurse to work overtime unless special circumstances apply, but a nurse can voluntarily agree to work overtime.
Federal Overtime Laws
As a Maryland employer, you also need to know federal overtime laws.
Under federal law, you have to pay one-and-one-half times the regular pay rate for any amount of time an employee works in excess of 40 hours in a seven-day period. Federal law also fully or partially exempts an employer from paying overtime to certain employees and/or under certain circumstances.
To fully understand your overtime obligations under Maryland and federal law, you should speak to an experienced employment legal matters attorney as soon as possible.
Penalties for Overtime Law Violations
Not only can improperly paying overtime mean having to pay expenses you might not have anticipated, it could subject you to extra penalties or criminal punishment.
Penalties Under Maryland Law
In Maryland, your employees can file a wage complaint and lawsuit if you don’t properly pay their overtime wages. If your employees win their lawsuit, you could be subject to any or all of the following penalties and punishment:
- An order to pay the unpaid wages;
- An order to pay up to three times the unpaid wages, plus attorney fees; and
- Criminal penalties.
Maryland law can impose criminal penalties if an employer deliberately withheld overtime pay without a valid reason, or if the employer hired an employee without an intent to pay them. These issues can ramp up slowly and can begin with an employee sending an employer a certified wage request letter.
If you receive a wage request from an employee and you’re unsure of your obligations, speak to a lawyer immediately. The earlier you handle a wage complaint the likelier you are to reach a resolution that isn’t painful.
Penalties Under Federal Law
If an employee or the federal Department of Labor file an overtime complaint against you under federal law and you lose, you could be subject to:
- Payment of back wages;
- Payment of liquidated damages;
- Payment of civil money penalties;
- An injunction;
- Payment of the employee’s attorney’s fees;
- Payment of the employee’s court costs;
- Criminal fines; and/or
Criminal punishment under federal law becomes a possibility if the employer willfully violates the overtime law.
From 2015 to 2020, the federal Wage and Hour Division recovered more than $1.4 billion dollars in back wages for employees. As an employer, you don’t want to be part of a statistic like that. The best way to avoid becoming a state or federal statistic is to have good pay systems in place for your business and to react to complaints promptly. A good employment legal matters lawyer can help you handle both of these tasks.
Speak to a Lawyer to Protect Your Business
As an employer, you don’t want anything to damage your business’s reputation or bottom line, and an overtime complaint can do just that. Whether you’re in the middle of a wage dispute or need advice on how to prevent complaints, the experienced legal team at Smithey Law Group LLC can help. We have a combined 158 years of experience, and we educate the legal community on employment law matters. We’re here to counsel you. Contact us online or call us at 410-811-8154 for winning employment solutions.