HR Basics, Legal Issues

Employment Law Basics: How to Handle the Fair Labor Standards Act

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Employment laws can be confusing and downright scary.

They don’t have to be. As a public service, from now until my special Halloween webinar Answers to the World’s Scariest Employment Law Questions, I’ll be tackling each major law one by one to give you what you REALLY need to know. By the end, you’ll have handy one-page cheat sheets for each and every law and your terror level will be reduced to zero.

Today’s Topic: the Fair Labor Standards Act.

Here is basically everything you need to know about the Fair Labor Standards Act (FLSA) in one handy post.

FLSA CHEAT SHEET

Who’s covered?

Employers with 2 or more employees.

What does it do?

  • Requires employers to pay no less than the minimum wage;
  • Requires employers to pay an amount equal to 1.5 times an employee’s regular rate of pay for all hours worked over 40 in a given week, unless an exemption applies;
  • Restricts employers from employing minors in certain jobs and for longer than certain periods of time;

What is an employee’s “regular rate?”

The total amount of money earned by an employee in a particular workweek divided by the number of hours worked.

What are the white-collar exemptions to overtime?

  • Executive: Employee must generally be primarily engaged in management, direct the work of 2 or more full-time employees and be authorized to affect the terms and conditions of other employees through hiring, firing, etc.
  • Administrative: Employee must generally be engaged in office or non-manual work related to general business operations and must use independent judgment and discretion with regard to significant matters.
  • Professional: Employee must generally perform functions that require advanced knowledge in a field of science or learning.
  • Computer: Employee must generally perform functions that require the application of systems analysis techniques, the design or development of computer systems or programs or the creation or modification of programs relating to operating systems.
  • Outside Sales: Employee must make sales and regularly work away from employer’s business.

What are an employer’s record-keeping responsibilities?

  • Maintain records of wages paid to non-exempt employees;
  • Maintain records of hours worked by non-exempt employees;
  • Keep records for 3 years.

What are the potential penalties?

  • Back pay;
  • Overtime pay;
  • Monetary fines;
  • Injunctive relief
  • Attorneys’ fees;
  • Criminal penalties;
  • Punitive damages;

Top FLSA tips

  • Be wary of state laws that may impose greater obligations.
  • No employee will be eligible for any of the white-collar exemptions unless paid the minimum amount required by statute.
  • Except for employees who qualify for the computer exemption, all employees who qualify for a white-collar exemption must be paid on a salary basis.
  • Non-exempt employees cannot agree to receive less than time and a half their wage rate for overtime work.
  • Job titles and descriptions are not conclusive evidence regarding exempt status.
  • Keep accurate records for all employees.

Stay tuned for more. Next week we’ll de-scare-ify the Family and Medical Leave Act (FMLA).

This was originally published on Manpower Group’s Employment Blawg.

Mark Toth has served as Manpower Group North America's Chief Legal Officer since 2000. He also serves on the company’s Global Leadership Team, Global Legal Lead Team and North American Lead Team. Mark is recognized as an expert on legal issues affecting the U.S. workplace and is frequently quoted in media from The Wall Street Journal to 60 Minutes. He is also a past Chair of the American Staffing Association and is a certified Senior Professional in Human Resources. Contact him at mark.toth@manpowergroup.com.