What the statutes mean

All staff must be paid overtime for all hours worked in excess of 40 hours per week unless they are excempt because of their job responsibilities (see below). Overtime includes the time spent attending conventions, seminars or other training sessions but does not include the time to travel to these activities or the lunch breaks during the seminars.

Under the Wisconsin Child Labor regulation, 16 and 17-year-old children may work more than 8 hours in a day or 40 hours in a week when school is not in session provided that they receive one and one half times the regular rate of pay for all hours worked in excess of 10 hours per day or 40 hours per week, and that they do not work in excess of 50 hours per week.

Lunches and breaks

The state recommends that you allow each employee, 18 years of age or over, at least 30 minutes for each meal period reasonably close to the usual meal period time (6:00 a.m., 12:00 noon, or 6:00 p.m.) or near the middle of a shift. Shifts of more than 6 consecutive hours without a meal period should be avoided.

You must pay all employees for on-duty meal periods, which must be counted as work time. An on-duty meal period is a meal period where the employer does not provide at least 30 minutes free from work. Any meal period where the employee is not free to leave the premises of the employer must also be considered an on-duty meal period.

Exemption from overtime

Staff whose primary duty consists of administrative, executive or professional work may be exempt from the payment of overtime only if their job duties closely correspond to the following definitions. You may not make a deal with a staff person to give up their overtime rights in exchange for other benefits.

“Executive” means an employee employed in a bona fide executive capacity who meets the following criteria:

1. The employee’s primary job responsibility consists of the management of the practice or a department of the practice; and
2. The employee customarily and regularly directs the work of two or more other employees; and
3. The employee has the authority to hire or fire other employees or their suggestions and recommendations about the hiring, firing, advancement or promotion or any other change of status of other employees is given particular weight; and
4. The employee customarily and regularly exercises discretionary powers; and
5. The employee does not devote more than 20% of his or her work hours to activities that are not directly and closely related to the performance of the work described in points 1 through 4. This point does not apply to employees that are in sole charge of an independent practice or a physically separated branch practice, and
6. The employee is compensated on a salary basis at a rate of $700 per month or more.

“Administrative” means an employee employed in a bona fide administrative capacity who meets the following criteria:

1. The employee’s primary duty consists of the performance of office or non-manual work directly related to management policies or general business operations of the practice, or
2. The employee customarily and regularly exercise discretion and independent judgment; and
3. The employee regularly and directly assists the doctor or an employee employed in a bona fide executive or administrative capacity; or they perform work requiring special training, experience, or knowledge under general supervision.
4. The employee does not devote more than 20% of his or her hours to activities which are not directly and closely related to the performance of the work described in points 1 through 3; and
5. The employee is compensated on a salary or fee basis at a rate of $700 per month or more.

“Professional” means an employee employed in a bona fide professional capacity who meets the following criteria:

1. The employee’s primary work consists of tasks that require knowledge of an advanced type in a field of science or learning customarily acquired by a prolonged course of specialized intellectual instruction and study, as distinguished from a general academic education or, work that is original and creative in character in a recognized field of artistic endeavor , and the result of which depends primarily on the invention, imagination, or talent of the employee, or
2. The employee’s work requires the consistent exercise of discretion and judgment in its performance; and
3. The employee’s work is predominantly intellectual and varied in character (as opposed to routine work) and for which the product or the result accomplished cannot be standardized in relation to a given period of time; and
4. The employee does not devote more than 20% of his or her hours to activities which are not an essential part of the work described in points (1) through (3); and
5. The employee is compensated on a salary or fee basis at a rate of $750 per month or more.

Calculating overtime compensation

“Week” means a calendar week or regular reoccurring periods of 7 consecutive 24-hour periods. Adults may work an unlimited number of hours per day or per week. You have the right to set the schedule of hours to be worked and the employee does not have the right to refuse to work.

“Regular rate” includes everything that is paid to the employee including their base pay, commissions, all types of bonuses, premium pay and any incentive plans.

You may choose to pay employees on an hourly basis, salary, commission, or other basis, but for purposes of calculating overtime pay for an employee, your wages must be converted into an hourly rate of pay. This can be accomplished by dividing the total hours an employee actually works in a pay period into the total regular wages the employee is paid in that pay period (regular wages would include hourly wages, commission, bonuses, etc.)

Example: The employee earns a salary of $400.00 per week plus incentives. In this week, the employee worked 44 hours and earned a incentives totaling $45.00. Total wages earned in that week total $445.00. The $445.00 becomes straight time for the 44 hours worked. The 44 hours are then divided into the $445.00 to arrive at the regular average hourly rate of $10.11 per hour. The $10.11 is then divided in half, $5.06, to arrive at the half time rate. Then the 4 hours of overtime (44 hours minus 40 equals 4 hours of overtime), times $5.06 equals an

additional $20.24 in overtime wage due in this week. Therefore, the total wages to be paid for that week equals $445.00 plus $20.24, for a total of $465.24.

Record keeping and penalties

You must keep permanent records for at least 3 years, available for inspection and transcription by the Department of Workforce Development (DWD) showing the name and address of each employee, the hours of employment and wages of each person.

An employee has the right to complain to DWD if they feel they have worked hours for which they should have been paid overtime. If a complaint is filed, DWD has the right to audit your payroll records to determine if you are liable. If you are found liable, DWD can expand the audit to see if other employees should have been paid overtime as well. For each violation DWD or circuit court may offer you a compromise in which the doctor agrees to pay, in addition to the amount of wages due and unpaid, increased wages of not more than 50% of the amount of wages due and unpaid.

If the employee takes civil action against the doctor and the doctor has rejected a compromise settlement, a circuit court may order the doctor to pay, in addition to the amount of wages due and unpaid to an employee and in addition to or in lieu of the criminal penalties, increased wages of not more than 100% of the amount of those wages due and unpaid.

Any chiropractor who has the ability to pay wages but does not pay his or her employees the wages they are due or, falsely denies the amount of the wages that are due may be fined not more than $500 or imprisoned not more than 90 days or both. Each failure or refusal to pay each employee the amount of wages due at the time, or under the conditions required in this chapter, constitutes a separate offense.

Statute excerpts

Definitions. DWD 274.01(1) “Day” means a calendar day or a period of 24 consecutive hours.

DWD 274.01(2) “Week” means a calendar week or a regular reoccurring period of 168 hours in the form of 7 consecutive 24 hour periods.

DWD 274.01(3) “Regular” time means 40 hours of work per week. Except in restaurants as provided in s. DWD 274.03.

DWD 274.01(4) “Overtime” means hours in excess of 40 hours of work per week. Except in restaurants as provided in s. DWD 274.03.

DWD 274.01(5) “Mercantile” means “pertaining to merchants or trade,” and is synonymous with the word commercial. Commercial is viewed with regard to profit or designed for profit; designed for mass appeal, emphasizing skill and subjects useful in business.

DWD 274.015 Applicability of chapter. Pursuant to s. 103.01 (1), Stats., employees employed in manufactories, mechanical or mercantile establishments, are covered by this chapter.

Hours of work. DWD 274.02(1) No person shall be employed or be permitted to work in any place of employment or at any employment for such period or periods of time during any day, night or week as shall be dangerous or prejudicial to the life, health, safety or welfare of such person.

DWD 274.02(2) It is recommended that each employer allow each employee, 18 years of age or over, at least 30 minutes for each meal period reasonably close to the usual meal period time (6:00 a.m., 12:00 noon, 6:00 p.m. or 12:00 midnight) or near the middle of a shift. Shifts of more than 6 consecutive hours without a meal period should be avoided.

DWD 274.02(3) The employer shall pay all employees for on-duty meal periods, which are to be counted as work time. An on-duty meal period is a meal period where the employer does not provide at least 30 minutes free from work. Any meal period where the employee is not free to leave the premises of the employer will also be considered an on-duty meal period.

DWD 274.03 Overtime pay. Except as provided in s. DWD 274.08, each employer subject to this chapter shall pay to each employee time and one-half the regular rate of pay for all hours worked in excess of 40 hours per week.

DWD 274.04 Exemptions. Except as provided in s. DWD 274.08, each employer subject to ch. DWD 274 shall be exempt from the overtime pay requirements in s. DWD 274.03 and these exemptions shall be interpreted in such a manner as to be consistent with the Federal Fair Labor Standards Act and the Code of Federal Regulations as amended, relating to the application of that act to all issues of overtime in respect to the following employees:

DWD 274.04(1) Persons whose primary duty consists of administrative, executive or professional work.

DWD 274.04(1)(a) “Executive” means an employee employed in a bona fide executive capacity who meets the following criteria:

DWD 274.04(1)(a)1. Whose primary duty consists of the management of the enterprise in which they are employed or of a customarily recognized department of subdivision thereof; and

DWD 274.04(1)(a)2. Who customarily and regularly directs the work of 2 or more other employees therein; and

DWD 274.04(1)(a)3. Who has the authority to hire or fire other employees or whose suggestions and recommendations as to the hiring or firing and as to the advancement and promotion or any other change of status of other employees will be given particular weight; and

DWD 274.04(1)(a)4. Who customarily and regularly exercises discretionary powers; and

DWD 274.04(1)(a)5. Who does not devote more than 20%, or in the case of an employee of a retail or service establishment who does not devote as much as 40%, of their hours of work in the workweek of activities which are not directly and closely related to the performance of the work described in subds. 1. through 4. provided, that this paragraph shall not apply in the case of an employee who is in sole charge of an independent establishment or a physically separated branch establishment, or who owns at least a 20% interest in the enterprise in which he is employed; and

DWD 274.04(1)(a)6. Who is compensated for their services on a salary basis at a rate of not less than $700 per month.

DWD 274.04(1)(b) “Administrative” means an employee employed in a bona fide administrative capacity who meets the following criteria:

DWD 274.04(1)(b)1. Whose primary duty consists of the performance of office or nonmanual work directly related to management policies or general business operations of their employer or their employer’s customers, or

DWD 274.04(1)(b)2. Who customarily and regularly exercises discretion and independent judgment; and

DWD 274.04(1)(b)3.a. Who regularly and directly assists a proprietor, or an employee employed in a bona fide executive or administrative capacity; or

DWD 274.04(1)(b)3.b. Who performs under only general supervision work along specialized or technical lines requiring special training, experience, or knowledge, or

DWD 274.04(1)(b)3.c. Who executes under only general supervision special assignments and tasks; and

DWD 274.04(1)(b)4. Who does not devote more than 20%, or in the case of an employee of a retail or service establishment who does not devote as much as 40%, of their hours worked in the workweek to activities which are not directly and closely related to the performance of the work described in subds. 1. through 3.; and

DWD 274.04(1)(b)5. Who is compensated for their services on a salary or fee basis at a rate of not less than $700 per month.

DWD 274.04(1)(c) “Professional” means an employee employed in a bona fide professional capacity who meets the following criteria:

DWD 274.04(1)(c)1. Whose primary duty consists of the performance of:

DWD 274.04(1)(c)1.a. Work requiring knowledge of an advanced type in a field of science or learning customarily acquired by a prolonged course of specialized intellectual instruction and study, as distinguished from a general academic education and from an apprenticeship, and from training in the performance of routine mental, manual, or physical processes, or

DWD 274.04(1)(c)1.b. Work that is original and creative in character in a recognized field of artistic endeavor (as opposed to work which can be produced by a person endowed with general manual or intellectual ability and training), and the result of which depends primarily on the invention, imagination, or talent of the employee, or

DWD 274.04(1)(c)2. Whose work requires the consistent exercise of discretion and judgment in its performance; and

DWD 274.04(1)(c)3. Whose work is predominantly intellectual and varied in character (as opposed to routine mental, manual, mechanical or physical work) and is of such character that the output produced or the result accomplished cannot be standardized in relation to a given period of time; and

DWD 274.04(1)(c)4. Who does not devote more than 20% of their hours worked in the workweek to activities which are not an essential part of and necessarily incidental to the work described in subs. (1) through (3); and

DWD 274.04(1)(c)5. Who is compensated for services on a salary or fee basis at a rate of not less than $750 per month.

DWD 274.04(2) Outside salespersons who spend 80% of their time away from the employer’s place of business.

DWD 274.06 DWD 274.06 Records. Except as provided in s. DWD 274.08, each employer shall keep permanent records for at least 3 years, available for inspection and transcription by a duly authorized deputy of the department, showing the name and address of each employee, the hours of employment and wages of each and such other records as the department may require.

DWD 274.07 Penalties. Any employer who violates order s. DWD 274.02, 274.03 or 274.06 shall be subject to the penalties provided in ss. 101.02 and 109.11, Stats. Each day of violation shall constitute a separate and distinct offense.