What’s in a name, particularly when it comes to job titles? What is a Guest Experience Manager in the restaurant industry? What responsibilities does a Carpet Shampoo Manager have on a day-to-day basis? What are the qualifications to earn the position of Director of First Impressions?
It turns out that certain titles can result in lower pay for hourly workers. Impacted staff lost an average of 13.5 percent of yearly compensation, or $3,194 per year. The total loss is $4 billion.
Potential wage theft?
Many consider the denial of overtime pay to qualified employees as nothing short of wage theft. The problem is most common in the retail and service industries. Family Dollar was the defendant in multiple states for not properly paying so-called managers earning the title for the company to save a few dollars of their own. Other lawsuits have resulted in settlements and verdicts for plaintiffs up to more than 35 million dollars.
Recently released research by the National Bureau of Economic Research reveals that the potentially unethical strategy diverts more money into employer coffers and less into the hands of their employees.
Federal law mandates that employers pay overtime to their workers provided they are not exempt due to their pay reaching a certain level or responsibilities being at a management level. Employers find ways around paying overtime by providing more “creative” manager titles to employees that do not have that level of responsibility.
Additional data from Harvard and the University of Dallas shows an alarming nearly 500 percent increase in manager titles. Overall, approximately 73,000 in the nation are in supervisory categories yet do not receive overtime pay. Companies save $4 billion yearly, breaking down to $3,194 per employee, accounting for 13.5 percent of annual compensation.