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  • per diem/employer profitting

    I have a question:

    My employer receives payment from clients for per diem rates as we get sent into the field for projects. Field personnel only receive 80% of the per diem rate and the employer keeps 20% for profit. It doesn't seem right. Is that allowed?

    We do not have a written policy and it seems to vary depending on the day of the week or the mindset of management...

  • #2
    If you received 100% of what the employer received, with what do you think the employer would pay his rent, or utilities, or unemployment taxes, or supplies, or other expenses? Don't you think the employer deserves a little bit of pay himself?
    The above answer, whatever it is, assumes that no legally binding and enforceable contract or CBA says otherwise. If it does, then the terms of the contract or CBA apply.

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    • #3
      There is no law requiring the employer to pay you what he is paid by the customer.
      I don't respond to Private Messages unless the moderator specifically refers you to me for that purpose. Thank you.

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      • #4
        Originally posted by cbg View Post
        If you received 100% of what the employer received, with what do you think the employer would pay his rent, or utilities, or unemployment taxes, or supplies, or other expenses? Don't you think the employer deserves a little bit of pay himself?
        they make enough off my unpaid overtime to make my extra $7/day worthwhile to me

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        • #5
          Originally posted by cbg View Post
          If you received 100% of what the employer received, with what do you think the employer would pay his rent, or utilities, or unemployment taxes, or supplies, or other expenses? Don't you think the employer deserves a little bit of pay himself?
          It's like they are in business or something!

          Your 'unpaid' overtime is an entirely different issue, and honestly, the only one that you have mentioned that may have some actionability!
          Not everything in America is actionable in a court of law. Please remember that attorneys are in business for profit, and they get paid regardless of whether or not you win or lose.

          I offer my knowledge and experience at no charge, I admit that I am NOT infallible, I am wrong sometimes, hopefully another responder will correct me if that is the case with the answer above, regardless, it is your responsibility to verify any and all information provided.

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          • #6
            Unpaid overtime is a different story. Not paying you the full per diem is legal. Not paying you ANY per diem is legal. Not paying you overtime when you work it is not legal.
            The above answer, whatever it is, assumes that no legally binding and enforceable contract or CBA says otherwise. If it does, then the terms of the contract or CBA apply.

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            • #7
              Originally posted by cbg View Post
              Unpaid overtime is a different story. Not paying you the full per diem is legal. Not paying you ANY per diem is legal. Not paying you overtime when you work it is not legal.
              Assuming you are in a position that is eligible for overtime. Your position may be exempt from overtime under wage and hour law.

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              • #8
                Good point...
                The above answer, whatever it is, assumes that no legally binding and enforceable contract or CBA says otherwise. If it does, then the terms of the contract or CBA apply.

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                • #9
                  True, that!

                  Originally posted by Pattymd View Post
                  There is no law requiring the employer to pay you what he is paid by the customer.
                  When I was an 18 year old summer "hand", my employer sent me to work in a refinery, cleaning tanks, for about 3 weeks. My employer was a large corporate entity that shall go unnamed (they once gave **** Chaney a $36M departing gift), and they made a lot of money on my work, as well as the work of others. The refinery paid them $10 an hour for my labor (union scale), and I got $1.50. I was really happy to get that. The company used the excess money to pay expenses, dividends, salaries, taxes, and maintain a large fleet of vehicles, among other things.

                  That employer treated me very well for 3 summers, allowing me to go to school 8 months out of the year, so I didn't have to work in tanks in refineries after I graduated. (I also worked 60 - 120 hours per week the whole time--good times!)

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                  • #10
                    OP,

                    Consider the per diem rate this way, the company decided what is wanted to pay their employees and added an administrative cost to the employee rate and the combined rate is what the customers are charged.

                    So you are not being denied part of your per diem but receiving what the company would pay you regardless.

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