LinkedIn will pay nearly $6 million in back pay and liquidated damages to 359 current and former employees following a Department of Labor investigation, reports the DOL. The employees, reports Business Insider, are commissioned inside salespeople. Typically, inside salespeople are not exempt under the FLSA, and must be paid overtime for all hours worked over 40. If an employee is paid a straight commission, you would, on a weekly basis, divide the commissions paid that week by the total numbers of hours worked to arrive at the hourly rate for that week. You would then multiply that hourly rate by 1.5 to obtain the overtime rate for that week, and pay the 0.5 premium rate on top of the commissions for any hours worked in excess of 40 for that week. LinkedIn says that the violation “was a function of not having the right tools in place for some employees and their managers to track hours properly.” Likely, it had mis-assumed that its inside salespeople were exempt. This story offers businesses two important lessons:
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