With the economy increasingly becoming competitive as days pass, it has become a norm for companies and businesses to ask their employees to work overtime having promised them compensation. However, some companies choose not to pay their employees on time for the work put during overtime. It is difficult to include overtime pay in one’s salary as the number of times an employee is expected to work overtime in a month can be unpredictable. This way, it is easy if overtime wages are paid separately. Nevertheless, it is completely non-ethical for a company or business to delay the payment of overtime wages owed to the employees without any explanation and genuinely understandable reason. This paper will highlight the reasons as to why late disbursement of overtime wages should be considered unethical and discuss legal channels that an employee may use in case the problem persists in the employer organization.
According to (Back, 2013), issuing payments to employees late signify how rotten the ethics of a corporate are. Late disbursement could lead to the eroding of a company’s culture from the inside. Presumably, an employee gets into a contract with the employer concerning the amount payable for working overtime and the due date. Ethically, underneath that contract lies the value that is trust. What makes the trust solid is honestly, mutual benefit, and fairness. If the employees have a significantly high level of trust towards the employer, then the organization gets itself into a sustainable competitive advantage which allows it to attract employees that are really talented and also establish a solid customer base. Furthermore, the organization gets into a better position of entering formidable and effective business partnerships. However, things start to go south when the payment contract between the employees and the employer s begins getting abused. The staff becomes unwilling to work overtime or do so with a lack of conviction. Trust between the two parties becomes broken. Unhappy employees lead to unproductive businesses. Furthermore, employees feel like they should penalize their employer for every day that the payment is delayed. Putting down the idea of penalties for late payment on contracts can help ease the tension. However, most companies do not do this.
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There are several steps the employees can take if an employer seems to continually remit the money intended for overtime payment into the employees’ accounts. The first step is to look at the legal implications of what sounds like the violation of the rights of employees. The Federal Fair Labor Standards Act (FLSA) contains information concerning wage payment and work hours laws ("Complying with California Wage Payment and Hours of Work Laws", 2018) . Federal laws require all employees to set regular paydays and ensure that the timestamps are met. State laws dictate the minimum number of days that employers should compensate employees. The paydays can be set to be weekly, monthly, or semimonthly. Most state-level fair labor standard laws are tougher on employees than federal level laws. The legal steps that an employee can take in case an employer constantly pays wages late vary from state to state. The employees may contact the state’s department of labor to report the case. The state department will then inform the employees of the state laws regarding the legal issue and the legal actions that the employees can take. Laws related to the paycheck tend to be vast and complex and accurate information can only be obtained if the state department is contacted.
Since we have established that late payment of overtime wages is an ethical issue, it means that it can be settled through indoor discussions. Now that the employees understand the state laws regarding payments better, they should first purpose to talk to their employer before taking any legal action. No employer would be happy if they were sued by their employees. Moreover, legal processes are not only time consuming but also tend to be costly, the employee-employer relationship will also be negatively affected after a lawsuit is filed. Employees could be surprised by how much holding talks with the employer would help. The employer probably never knew such a problem existed as it was due to an error in the payroll. In such a case, fixing the problem would be easy. However, if the issue keeps recurring and the employer seems negligent about it, then employees may demand a penalty for late payment of overtime wages if the state laws allow them to. If not, then legal action should be taken against the employer.
The positive thing about ethical issues is that they can be resolved by a mere discussion. Until now, this paper has had a one-sided view of the subject matter. It is important that we also look at the issue from the perspective of the employer. There are several reasons as to why the employer may fail to pay overtime charges on time. In fact, cases in which companies have been unable to pay their employees their monthly dues are not rare. Organizations, at times, find themselves in difficult situations that may be beyond the control of the management. This is why it is important for an organization to build a good rapport with its employees and create a healthy culture. Happy employees tend to understand when the organization is going through a difficult time and most of them may be willing to bear with the company. If the organization has been treating its employees well and as per the contracts handed to them, then employees may even work overtime without getting paid on time and still stay productive.
Nonetheless, the question as to whether or not employees should ask for a percentage for each day late for overtime wages that are not paid on time still begs. In my opinion, this is highly dependent on the relationship between the employer and the employees. The relationship tends to be solid if a conducive workplace culture had been put in place by the employer. If the relationship is solid, then I would not recommend for employees to ask for a percentage for each day late. A conducive workplace environment means that the employer is working to ensure that the employees remain happy and satisfied. Such an employer would not deliberately hold onto funds meant to pay the employees for overtime work. Effectively communicating with the employees would solve the problem in this case. However, the employer should work to reinstate the situation back to normal in the shortest time that it is possible. Again, it is advisable for the employer to be open about how long the organization will take to normalize the situation.
The decision as to whether or not to ask for a percentage for each day late boils down to the workplace’s culture and how effectively the employees have been communicated to. As much as it is unethical for a company not to pay its employees on time, open communication can help resolve to resolve the problem and buy an organization time to get back to its feet. The notion that there exist moral emotions is true (Lindebaum, Geddes, & Gabriel, 2017). An employee can decide whether or not to ask for a percentage penalty depending on his relationship with the organization. In the long run, it all boils down to the employee-employer relationship. A positive work attitude reduces ethical conflict (Valentine, Hollingworth, & Eldsness, 2014). Right from the beginning, the organization should look to build a positive and ethical workplace because difficult times may arise but positive attitudes tend to outpower such times.
Conclusion
Different states have different laws concerning late disbursements of payments. However, this paper has managed to show that late payment of overtime wages is a universally ethical issue that not a single employer should be comfortable with. Late payment creates a toxic workplace culture which is listed among the top 5 common unethical issues universally. For employees, going about this issue may be difficult as it may involve clashing with the management. Like any other ethical issues in the workplace, the process of resolving this issue should be handled diligently and with soberness. Employees should avoid filing claims in the court at all cost and must only resolve to legal procedures once it has been established that the employer will never soberly resolve the issue of late payment of overtime wages.
References
Back, P. (2013). Paying late: an ethical business issue. Retrieved 17 August 2019, from https://www.theguardian.com/sustainable-business/blog/paying-late-ethical-business-issue
Complying with California Wage Payment and Hours of Work Laws. (2018). Retrieved 18 August 2019, from https://www.shrm.org/resourcesandtools/tools-and-samples/toolkits/pages/ca_complyingwithwagepaymentandhoursofworklaws.aspx
Lindebaum, D., Geddes, D., & Gabriel, Y. (2017). Moral emotions and ethics in organisations: Introduction to the special issue. Journal of Business Ethics , 141 (4), 645-656.
Valentine, S., Hollingworth, D., & Eidsness, B. (2014). Ethics-related selection and reduced ethical conflict as drivers of positive work attitudes: Delivering on employees’ expectations for an ethical workplace. Personnel Review , 43 (5), 692-716.
