Avoid a wage and hour audit

The Department of Labor's wage and hour division recovered more than $185 million in 2008 for some 228,000 employees. Over the past eight years, that number has topped $1.4 billion. "Practice owners need to be very concerned," says Monica Dixon Perry, CVPM, a consultant with VMC Inc. in Evergreen, Colo.

If your veterinary practice is audited, it may be that a disgruntled employee has notified the division that there's a problem with your wages, overtime pay, employee hours, record keeping, medical leave, or wage garnishments. The audit will seek to establish your compliance with both state and federal wage and hour laws.

For example, Dixon Perry says she's heard stories of employers who don't make employees clock in and out for lunch—essentially paying team members for mealtime. If these practices are audited, they lack evidence to show they're giving employees that mandated break. "If it's ordered by your state and you have no proof you're providing it, you'll have to pay back wages and penalties for all employees affected—up to three years' worth in some states," she says. "So it's very important you document everything."

Dixon Perry knows the repercussions of the audit process firsthand: In the early 1990s, she was an employee at a veterinary hospital while attending college. Several years after working there, she received a check for about $400 for work she hadn't been paid for. "In the end, regardless of what you think your odds are of an audit, do it right," she says. "Don't set yourself up for what could be a very costly mistake."