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even greater challenges as regulators at each of these levels retool wage- and-hour regulations to refl ect a greater sensitivity to employee rights. Businesses must skillfully navigate this shifting terrain to avoid errors that spark costly fi nancial penalties. "Employers are responsible for making sure payroll is done correctly," Lambert states. " ey must keep up to date with changing laws." In a growing number of cases, as stated earlier in this article, violations can spark criminal rather than civil actions. Intentionality is key. "If failure to pay overtime is simply a result of miscalculation or misclassifi cation, that's a civil action rather than a criminal one," Gregg explains. "In order to be a criminal action, the individual must show intentionality. Some examples of intentionality are having people work off the clock so the business can avoid overtime, deliberately pocketing the overtime money or engaging in a variety of tricks to deliberately avoid paying overtime so that people do not get what they're due." Even wage theft done for good purposes can spark criminal prosecution. "Economic hardship brought on by the pandemic caused a number of business owners to avoid paying wages in order to keep their businesses afl oat," Gregg says. "In some cases, they thought, 'If I can't pay the rent or utilities and we close, I won't be able to pay anybody, so everybody will lose their jobs. erefore, I will not pay them any overtime, or I won't pay them what they're due. Or I will pay them under the table so that neither we nor they have to pay the taxes. And we will take the money and pay the bills.' e fact is that even if business owners didn't actually stuff the money into their own pockets, the wage theft was an intentional act of breaking the law." Flying without an adequate legal radar can result in a crash landing. "Many retailers don't understand wage-and- hour laws and make things up as they go along," says McKenzie. " ey think everything will be okay, but, sooner or later, they get caught." Final thought: e so-called "Infl ation Reduction Act," signed into law in August by President Biden, empowers the IRS with nearly $80 billion in new funds, which the agency in predicted to use to go on a hiring spree—87,000 new agents—to fuel much tougher enforcement and collection eff orts. WHAT'S YOUR SCORE? •80 or more: Congratulations. You have gone a long way toward preserving your business from costly wage-and-hour violations. •60 or 70: It's time to fi ne-tune your overtime procedures. •50 or less: Your business is at risk. Immediately act on the suggestions in this article. Is your retail business prepared to defend its overtime exemptions to inspectors from the Department of Labor? Find out by taking this quiz. Score 10 points for each step your business has taken. Then total your score and check your rating at the bottom of the quiz. 1. Ensured that all exempt (salaried) employees are paid at least the legal salary threshold ($684 per week/$35,568 per year) 2. Determined that all exempt individuals can pass the appropriate "duties tests" 3. Assumed "nonexemption" in ambiguous cases 4. Maintained detailed time sheets to support overtime decisions and any FLSA Section 7(i) exemptions 5. Prohibited all employees from working off the clock, even during lunch hours 6. Paid for all overtime worked, even if employees violate company policy in doing so 7. Instructed employees, including remote workers, to record even short periods of time they work, such as sending or answering business emails or making or returning phone calls 8. Ensured that any freelancers or independent contractors are legitimately self-employed 9. Paid employees for any standby time 10. Avoided questionable paycheck deductions

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