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We’ve compiled a list of the 100 most commonly asked questions we have received on the federal Fair Labor Standards Act (FLSA) overtime regulations.
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This report, "Top 100 FLSA Q&As", is designed to provide you with an examination of the federal FLSA overtime regulations in Q&A format, including valuable tips for bringing your workplace into compliance in an affordable manner.

At the end of the report, you will find a list of state resources on wage and hour issues. This report includes practical advice on topics such as:
  • FLSA Coverage: How FLSA regulations apply to all employers and any specific exemptions from the overtime requirements
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  • Deductions from Pay: Deducting for violations, disciplinary reasons, sick leave, or personal leave

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September 11, 2003
Workplace Stress—What Are the Costs?
For a Limited Time receive a FREE Compensation Special Report on the "Top 100 FLSA Q&As," designed to provide you with an examination of the federal FLSA Overtime Regulations in Q&A format, including valuable tips for FLSA Coverage, Salary Level, and Deductions from Pay. Download Now
hough they are not a large percentage of workplace claims, workplace stress claims are the fastest growing type of workers' compensation claim today. And workplace emotional stress may be an employer's largest hidden cost. A study conducted by the National Institute for Occupational Safety and Health (NIOSH) found that more than half of the working people in the United States consider job stress a major problem in their lives.

What does workplace stress cost employers, and in what ways? Certainly, one cost is in health care, the burden of which is largely the employer's. Another is in workers' compensation claims—stress claims have risen a great deal in the last 15 years. A third cost is in workplace performance, and perhaps this is the most common and most widespread cost.

What is workplace stress? Stress, in general, is defined as the physical pressure exerted on one thing by another. But the kind of stress we're discussing here, emotional stress, can be described as strain, tension, or pressure that causes a physiological and/or psychological effect on a person's body or a deforming effect on a person's emotions. For example, abuse or harassment on the job, or exposure to an assault or workplace robbery, might lead to workplace stress. Most claims of workplace stress result from cumulative exposure to the precipitant such as harassment, although exposure to one traumatic incident (such as an act of violence) might account for stress at the time of the incident or later.

How is performance affected by stress? Workers that describe themselves as stressed have more than double the absentee rate of other employees. Intrapersonal problems caused by stress often blow up into verbal or even physical conflict among workers or disobedience or disloyalty between worker and supervisor. Highly stressed workers are rude and alienating to co-workers, clients, vendors, and customers. Stress causes workers to make errors and burn out on the job. It causes workplace turnover. It distorts emotional and physical perception, causing workers to overreact to normally small incidents and to overlook safety problems. It lowers productivity and can cause accidents.

What may happen at work? According to employees, the most frequent reason for workplace stress is job pressure, followed by harassment. Of course these are subjective phenomena, but, if brought to litigation, they are sometimes recognized as legitimate by courts and workers’ compensation commissions. Even more disturbing is that, generally speaking, the pressure and harassment workers complain of are all too often caused by supervisors or even employers.

For example, a Kentucky manager of a fast food restaurant attributed her heart attack to her anxiety on the job because of extremely long hours of work, her inability to get the job done because of severe understaffing, and her fear of the restaurant's owner, who swore at her, harassed her, and mocked her religion. Although her workers' compensation claim was denied by an administrative law judge, the state’s workers' compensation commission reversed that decision. If the heart attack was caused by or precipitated by her job stresses, ruled the commission, it would be compensable.

Types of workers' compensation and emotional stress claims

  • Mental-physical. This happens when mental stress causes physical disability, as in the Kentucky example above. This is a condition recognized as a workers' compensation injury in many, but not all, states.
  • Physical-mental. This happens when a physical accident or injury brings about a mental condition. For example, an employee that suffers a permanent back injury that affects his ability to get about and as a result suffers mental consequences; these also constitute a disability. In Virginia, for example, a nurse that underwent many surgeries because of a work injury developed suicidal thoughts and was awarded total disability benefits because the psychiatric condition was caused by her pain and surgical trauma. Again, this is an injury recognized by many states, but not all of them.
  • Mental-mental. In this case, workers suffer mental disability because of work stresses or mental stimuli. It may even be that the worker already suffers from a mental disorder that causes his or her reaction to the work event to be purely subjective and distorted. For example, in Michigan a worker was awarded benefits for a mental breakdown brought on by the fact that he could not keep up with the production rate of an assembly line. In most states however, the work stress must be greater than the normal day-to-day stress that employees typically experience. Inability to keep up with production standards would probably not count in those states. On the other hand, in New Jersey, which takes a middle-of-the-road approach to mental-mental injuries, a worker was awarded benefits after he broke down as the result of an explosion with fatalities in the workplace that he witnessed but that caused him no injuries.

Stress because of work-related discipline Generally, these claims are not recognized under workers' compensation unless the human resources action is extraordinarily poor (e.g., abusive). That does not mean they are without cost, however. Workers can react very badly to disciplinary actions, even if they are deserved, and may act just the opposite of the intended response. Employers (and supervisors) should be careful when they are disciplining to take the action without becoming overly harsh or abusive.

Most employees that are terminated do not "take revenge" in acts of workplace violence. Still, if at all possible, terminations should be done sensitively and with care for the person's pride and spirit.

Costs are high. The expense of workplace stress is high, both in hard dollars and in intangible losses. If such claims are recognized by workers' compensation, they are expensive to treat, generally costing more than other injuries. If stress leads to physical illness or injury, it is often longer-lasting than other injuries. If the claim is not accepted by workers' compensation, it may place a strain on the employer's health insurance, because such claims may be long in duration and conditions difficult to treat. Workplace stress may result in the loss of a good employee. And finally, it nearly always results in confusion and conflict in the workplace and lowering of productivity of the affected employee.

Employers and supervisors should be aware of the pressures and conflicts in the workplace, and intervene when pressure is becoming high. Or it might be a good idea to have an Employee Assistance Program do a regular audit to assess the stresses and strains in your workplace.

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