Laws and regulations protecting the rights of workers are getting stronger every year, and this can have a dramatic effect on businesses. These laws mandate a variety of different requirements and rules for companies to follow, but it isn’t always straightforward to make sure your organization is fully compliant.
One growing area of concern is compliance with meal break laws. Meal break laws vary from state to state, but many of them have a similar idea: Employees must take a (usually unpaid) meal break of 30 minutes during their work period, as long as their shift exceeds a state-mandated limit. This page from the Department of Labor breaks down the specific meal break laws by state.
We’ve spoken to employers of thousands of hourly workers in Massachusetts and California (two states with particularly strict meal break laws). These employers fill hundreds of thousands of shifts every year.
When interviewing them, we quickly learned the predicament most were in: Many don’t regularly track and report meal break compliance internally - even those with electronic time clocks where employees are supposed to clock-out for breaks rarely had any sort of insight into their compliance. The select few who did track compliance averaged 5-10% of all shifts out of compliance with state laws over the last calendar year. (We imagine this number is far higher for companies who don’t track compliance.) Thousands of noncompliant shifts are a serious risk for any company.
Let’s imagine the worst-case scenario here: Your company doesn’t track meal break compliance. Somehow, an anonymous complaint surfaces that one of your past supervisors didn’t allow employees to take any breaks. You fired this employee long ago, but now the government requests all your historic time clock data to assess your penalty. In Massachusetts, the penalty for each violation ranges from $300-600. The investigation surfaces you’re out of compliance 12% of the time - your company’s 1,000 employees worked 250,000 meal-break-eligible shifts last year, and 30,000 of those shifts either had no meal break, too short a meal break, or a meal break taken too late.
The fine could tally up to $18 million for the year. Not including damages paid to employees. Is it likely that this will happen to you next year? Of course not. Is it possible? Of course it is. The problem is that today’s system puts the responsibility for taking breaks squarely in the hands of your employees, which naturally results in mistakes. Some employees may forget to clock out for their break. Sometimes employees might be overwhelmed with work and do not take the full 30-minute break. Employees may not know the break rules. Sometimes supervisors aren’t clear on the break rules either - or perhaps they have other more pressing priorities than monitoring meal break compliance. After all, there is work to be done.
As previously mentioned, we estimate that 5-10% of shifts are out of compliance in states with clear laws. In states like California where these laws are stricter and more complex, we estimate that up to 15% of all shifts are in violation of meal break laws - and as more and more states are increasing their regulations on labor, this share will only continue to grow.
Businesses have generally taken two different approaches when it comes to tracking their compliance and mitigating risk. The most common is to generate reports using data from a digital time clock. The reports are then reviewed each week to check for discrepancies and compliance trends. While this may sound useful in theory, operators lament how reactive this practice is - how reviewing reports after-the-fact is time-consuming for everyone involved and doesn’t seem to move the needle. Even with a digital system supplying the data, these reports are usually very time consuming to create and reviewed well after the relevant period. Even if the data is revealing, it is too difficult to act upon it meaningfully - sites can be geographically disconnected, and communication can be slow.
The second approach that is often taken by businesses is more software oriented. Some executives we have spoken to have led initiatives to re-design their timekeeping solution to solve this problem. Some “solutions” are unwise - like automatically subtracting a 30-minute meal break from your employees’ shifts. (If you don’t want the government to come knocking, we don’t recommend doing this.) Others are more subtle - automatically generating reports versus having your administrative staff generate them every week. Regardless, customization typically means large up-front fees and moving deadlines.
Luckily, there are alternatives to costly customizations. SYRG plugs into your pre-existing timekeeping system as a layer on top. SYRG sends just-in-time notifications to managers whose employees are about to break compliance - either in the form of reminders to clock in or notices of workplace trends. This allows supervisors to prevent compliance issues before they ever become a risk to the business.
To learn more about SYRG, contact us at email@example.com to hear about how we’ve helped businesses like yours.