Do Salaried Staff Have to Keep Time Cards?

Time to work, clock-face and money background image by Nikolai Sorokin from Fotolia.com

To determine whether employees are arriving and leaving work as scheduled, the employer may require that they clock in and out using a time card. The time card also helps the employer to determine the number of hours to pay an hourly employee for the pay period. Salaried workers, not paid by the hour, usually have no requirement to keep time cards. However, exceptions apply.

Identification

A salaried employee receives a predetermined amount of pay each pay period. This can be all or a portion of her income, but it must be a guaranteed amount she can count on. A salaried employee generally receives her full pay, even if she takes a partial day off. The employer can dock her pay only if a permissible deduction applies, such as overuse of benefit days, unpaid suspension, or, perhaps, to offset jury duty fees paid to her. To determine salary per pay period, the employer divides the annual salary by the number of annual pays. The employee’s salary generally stays the same each pay period, unless she has a pay or deduction change.

General Rule

The majority of salaried employees are exempt, meaning they are exempt from the Fair Labor Standards Act overtime pay requirements. Most hourly employees are nonexempt, and therefore qualify for overtime pay. The U.S. Department of Labor requires employers to keep payroll records for each nonexempt worker. Records should include the time and day the employee’s workweek starts, work hours for each day and total work hours for the week – the employee’s time card has this information.

According to 29 C.F.R. subsection 516.3 of the FLSA Record-keeping Regulations, employers must keep records showing the basis on which exempt employees are paid, but they do not have to keep a record of hours worked. For this reason, employers do not need time cards for most salaried employees.

Exception

Though most salaried employees are exempt, some are nonexempt. The employee must fulfill the FLSA exempt salary and job-related requirements to be exempt. If the employee does not meet the exempt requirements, he is nonexempt and qualifies for overtime pay. In this case, the employer keeps time card records for the salaried employee.

Considerations

Though most exempt workers are salaried, a few, such as a schoolteacher or physician, are hourly. These professionals receive hourly pay, but do not qualify for overtime. Though many employers do not require exempt employees to punch a time clock, the FLSA does not forbid them from doing so. Therefore, an employer can request all employees – hourly, salaried, exempt and nonexempt – to punch a time clock.

References

Resources

About the Author

Grace Ferguson has been writing professionally since 2009. With 10 years of experience in employee benefits and payroll administration, Ferguson has written extensively on topics relating to employment and finance. A research writer as well, she has been published in The Sage Encyclopedia and Mission Bell Media.

Photo Credits

  • Time to work, clock-face and money background image by Nikolai Sorokin from Fotolia.com