Could Smartphones Cost You More Than Just Data Charges?

We are currently living in the age of the smartphone. Everywhere you turn, people are looking at apps, surfing the Web on their phone or checking their email. Those in the business world are among the heaviest users of smartphones and personal digital assistants (PDAs)—the allure of being constantly tied to email is too strong to pass up. The rise of the smartphone has changed the dynamics of the typical work day. Gone are the days of putting in a strict 9 to 5. With constant access to the office, workers are now able to check and send business-related emails during non-office hours. This could lead to trouble for companies that have issued smartphones to their employees.

According to the National Association of Wholesaler-Distributors (NAW), there recently has been a rash of lawsuits brought under the Federal Labor Standards Act (FLSA) against companies by employees who expected overtime pay for emails and calls placed on their smartphones or PDAs during non-work hours. The FLSA specifically states that unless an employee is “exempt,” the worker must be paid overtime for time worked in excess of 40 hours in a week. Exempt employees tend to be salaried workers who qualify under Labor Department regulations as executive, administrative, professional, computer or outside sales personnel. However, an employee’s job title or status as a salaried worker alone does not determine whether he or she is “exempt”. (See Department of Labor regulations, 29 CFR Part 541 for a full explanation.)

The lawsuits allege that the nonexempt employees were expected, or at the very least allowed, to respond to business-related emails and calls outside of normal business hours. By nature of being nonexempt, the suits allege that these employees are entitled to overtime pay for all time spent responding to emails and calls during these off-hours.

Gases and Welding Distributors at Risk?
Many gases and welding distributors issue smartphones to their employees and therefore may be at risk. “We issue Blackberrys to our employees that are mainly used for email purposes,” says Mark Bergstedt, corporate marketing manager at Rockford Industrial Welding Supply (Rockford, IL). “We don’t limit usage, but the issue of overtime has never been brought up.”

Russell Strate, president at Strate Welding Supply Company (Buffalo, NY), says the company issues phones, but does not ask employees to use them outside of hours. “If our employees get calls after hours on their cell phones, it is because they gave their number out and told a customer they are available,” he says. “We do not mandate it. It is their choice.”

There are ways that companies can limit their exposure to lawsuits. One way, according to NAW, is to issue phones only to exempt workers. While it makes sense for some distributors to provide phones only to managers and salespeople, some circumstances may present more of a challenge. “Our drivers are given phones that are tied into a GPS tracking system,” says WestAir (San Diego, CA) General Manager Ron Savage. “We have drivers that are on duty 24/7 on a rotating basis, and they are required to take calls when they are on duty.” In unavoidable circumstances, NAW says, “If it is essential to equip a nonexempt employee with a PDA, then the employer needs to establish rules as to their off-hours use.” This could mean requiring express authorization, outlining acceptable circumstances or prohibiting use altogether.

Furthermore, NAW advises, “Whatever the policy, the wholesaler-distributor should require its nonexempt employees to track and record all time spent using any PDA or other device for work purposes during off-hours.” By having hard and fast records of usage, the employer can control overtime and limit exposure to claims for overtime pay. As with any legal situation, it is advisable to consult your lawyer to make sure you are fully protected.

(Disclaimer: The information provided in this article is for informational purposes only and should not be considered legal advice.)

Gases and Welding Distributors Association