Monday, 1 November 2010

The Fair Labor Standards Act (FLSA)

Author:  Patrick Hanan

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Administered and enforced by the Department of Labor's Wage and Hour Division, the Fair Labor Standards Act (FLSA) establishes Federal standards concerning overtime, minimum wage, and record keeping. It includes parameters governing who is exempt from minimum wage requirements and who is not, minimums for overtime pay, and policies for minors.
Overtime Law
The FLSA defines overtime as any time worked over 40 hours in a standardized workweek. This workweek is considered a fixed and recurring period of 168 hours, in other words, seven consecutive 24-hour periods.
It is explicitly stated that an employer cannot average two or more workweeks to determine overtime for its employees. That is, working 25 hours one week and 55 hours another week does not legally average to two 40-hour workweeks; non-exempt employees would be entitled to 15 hours of overtime for the latter.
Overtime pay is defined as time-and-a-half, or 1.5 hours' pay, for every hour worked over 40 hours a week.
Minimum Wage Law
On July 24, 2009, the Federal minimum wage was established as $7.25 per hour, raised from the former rate of $6.55 per hour. For employees under 20, the government requires they be paid no less than $4.25 for their first 90 consecutive calendar days of employment. After this period, they must be paid at the standard $7.25 rate. There are a few exemptions to this rule as well.
Many states have their own higher-paying minimum wage laws. In these cases, the employee is required to receive the higher minimum wage that the state provides.
Exempt and Non-Exempt Employees
The Fair Labor Standards Act does provide a few exceptions to the broad guidelines outlined above. Employers that make less than $500,000 a year are generally exempt from providing the above requirements to their workers, but this does not include hospitals, most schools, and government agencies, among others. Some examples of employee types that are exempt from overtime or minimum wage requirements:
  • Executive, administrative, and professional employees (defined and outlined in the Act)
  • Employees of some small newspapers
  • Newspaper delivery persons and babysitters
  • Farm workers on small farms
This list is not exhaustive; more information on labor law can be found on the Department of Labor's website.
You may not be getting the compensation you are entitled to. Visit Lawyer Central for more Fair Labor Standards Act and employment law information.

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