A reader writes:
So here’s the sitch: I’m a new-ish office assistant at a small business and was tasked with creating a job posting for one of our in-store entry level positions. I discovered that new entry-level hires are not paid for any training until they have been on the job 90 days. “Training” as defined by my company includes orientation and job shadowing, as well as closely monitored shift work (usually around 2 shifts). I’m not sure if this is legal under current wage laws (our business is located in Michigan, by the way) or if it is considered work without wage. The owner is well-intentioned and enacted the policy because of high trainee turnover, but I don’t want him to get in trouble with the state. Any idea if this is okay or not? Is “training pay” (i.e. sub minimum wage) also illegal? I’m looking for any possibilities that might make this a less difficult transition for him, financially.
I’ll still be recommending he overhaul the hiring process to decrease turnover. He has a tendency to hire on a handshake and “gut feeling” without doing any further digging.
Ah yes, gut feelings — a great way to go wrong in hiring and employment law.
Not paying your new hires during their training is nearly always illegal. Employees must be paid for all time they spent working, which generally includes training time. The only time where training would not count as working time is when all four of these criteria are met: (1) attendance is outside normal hours, (2) attendance is voluntary, (3) the training is not job-related, and (4) no other work is concurrently performed. The situation you described sounds like it fails all four of these. That means that it needs to be paid, and that your employer is setting himself up for some major penalties and back-pay awards if he doesn’t remedy this ASAP.
Nor is paying a training wage that’s below minimum wage legal, although Michigan makes an exception for new employees aged 16-19 for the first 90 days of their employment.
That said, I wonder if your boss is thinking of pre-employment training. There’s a weird thing in the law where pre-employment training programs are regulated differently. If all six of these criteria apply, an employer actually isn’t required to pay for pre-employment training:
* The training, even though it includes actual operation of the employer’s facilities, is similar to training that would be given in a vocational school (this means the training is “fungible,” or interchangeable, and can be used by the employee in another position with another employer)
* The training is for the benefit of the trainee
* The trainees do not displace regular employees but work under close observation
* The employer that provides the training derives no immediate advantage from the trainees’ activities and at least on occasion, its operations may actually be impeded
* The trainees are not necessarily entitled to a job at the completion of the training period
* Both the employer and the trainees have an understanding that the trainees are not entitled to wages for the time spent in training
It doesn’t sound like your training program meets this test, and so the time would still need to be paid … but it’s possible that this is what your boss is thinking of.
But totally aside from the law, this practice is crazy, since your boss is really unlikely to be able to hire good people this way. Good people have options, and they rarely want to work for free for three months.