In Tennessee, as throughout the rest of the country, employers must comply with wage and hour laws to prevent costly wage and hour lawsuits from employers, avoid expensive state and federal penalties, and to maintain fair labor practices that improve worker retention. Unfortunately, too many employers make common mistakes that can damage their reputation and their business.
As an employer in Tennessee, it is critical that you understand wage and hour laws so you remain compliant and avoid the serious penalties associated with violations. Below, our Knoxville employment lawyer outlines the most common mistakes and how you can avoid them.
Failing to Pay Minimum Wage
Under the Fair Labor Standards Act (FLSA), employers must provide at least the federal minimum wage. Many states establish their own minimum wage, and employers must comply with these standards. However, Tennessee does not outline a state minimum wage, and so employers must follow federal regulations. In 2026, the federal minimum wage is $7.25 per hour. Failing to provide the minimum wage is one of the most common wage violations in Tennessee.
Failing to Pay Overtime
The FLSA also provides eligible employees with the right to overtime compensation equivalent to 1.5 times their regular wage for any hours worked beyond 40 per week. Employers sometimes violate the overtime laws by requiring employees to work off the clock, misclassifying employees as independent contractors, or providing ‘time off in lieu’ instead of overtime wages.
Requiring Employees to Work Off the Clock
Many employers often think they are only asking employees for a favor, or asking them to do one quick task on their way out of work. If the employee is not clocked in, though, this is illegal. Employees deserve compensation for any time spent performing employment duties.
Employers may also require workers to attend a meeting in an unconventional place, such as a coffee shop, ask them to clean up after they have clocked out, or require them to respond to phone calls or emails after they have clocked out for the day. All of these are illegal and can result in penalties for non-compliance.
Misclassification of Employees
Many of the wage and hour laws are outlined in the FLSA, but this Act does not cover all employees. To avoid the laws, employers may sometimes misclassify workers. For example, independent contractors are not covered under the FLSA, and so, employers do not have to pay them minimum wage or overtime pay. Instead, there is typically a contract that outlines these provisions. Misclassification is another very common violation of the wage and hour laws.
Improper Deductions
Employers are required by law to make certain deductions from employees’ paychecks. For example, employers must withhold certain taxes and court-ordered payments, such as child support payments, from employees’ paychecks. However, many employers withhold more than the required deductions.
Many employers deduct the cost of uniforms from paychecks or the expense of supplies they told workers they would provide. In other instances, employers may simply reduce a worker’s pay without notice or a legally valid reason.
Meal and Break Period Violations
Employers in Tennessee are required by state law to provide 30-minute, unpaid meal or rest periods to workers scheduled to work 6 or more consecutive hours. Employers are not required to provide break periods shorter than this, such as a 15-minute coffee break.
However, under the FLSA, if an employer allows workers to take a break period of 20 minutes or less, the employee must be paid as though the break was paid work time. Many employers offer shorter breaks instead of offering the 30-minute rest period when required by law. They then argue that because it was a short break, they are not required to pay the employee for it, although it is against the law.
Employer Retaliation
When employers violate state or federal wage and hour laws, they can file a complaint or lawsuit against them. It is illegal for employers to retaliate against employees for taking these actions. Retaliation can take many forms, such as demoting an employee or terminating them.
How Can Employers Protect Themselves from Penalties for Non-Compliance?
It is important for employers to speak to a Knoxville employment lawyer who can advise on how to stay compliant with the wage and hour laws. An attorney can make many recommendations, including the following:
- Audit exempt classifications: Make sure that salaried employees and independent contractors meet the minimum ‘employment duties’ and salary tests outlined under the FLSA. This can help you avoid penalties for a misclassification violation.
- Enforce minimum 30-minute breaks for meals and rest periods: Ensure that you are provided the necessary meal and rest breaks for any employee working a shift longer than six hours. Remember that these breaks cannot occur within the first hour of an employee’s shift. There are exceptions for employees in workplace environments that naturally allow plenty of opportunity to eat and rest. If you believe your workers fall into this category, it is important to speak to an attorney who can advise on your case.
- Require accurate records: Require all non-exempt staff members to keep accurate time records for all time worked. These records should include any duties performed off the clock, such as answering emails.
- Understand tipping laws: If employees in your workplace receive tips, it is critical that you understand the laws that govern them. For example, while you can enact a tipping pool, workers who did not directly provide a service to customers, such as management, cannot receive any portion of the tips.
Call Our Employment Lawyer in Knoxville Today
It is critical for all employers in Tennessee to remain compliant with the state and federal wage and hour laws. At The Ebbert Law Firm, our Knoxville employment lawyer can advise you of the laws and how to remain compliant with them so you do not face harsh penalties from government authorities or your employees. Call us now at (865) 290-7637 or fill out our online form to schedule a consultation and to learn more about how we can help with your case.