Established as a US federal law in 1938 to regulate minimum wage, overtime pay, child labor standards, and recordkeeping for employees, the Fair Labor Standards Act (FLSA) is an important piece of legislation for workers and employers alike.
Under the FLSA, non-exempt employees are legally entitled to at least the federal minimum wage, as well as overtime pay at one and a half times their regular rate of pay once they exceed 40 working hours per week.
What Does the FLSA Cover?
The Fair Labor Standards Act has many provisions that seek to ensure that all US workers are fairly compensated for the hours that they work. Key regulations within the act include:
Minimum Wage
The FLSA ensures that all employees will receive the federal minimum wage, which is currently $7.25 per hour. While many states have sought to bring in higher minimum wages, the Fair Labor Standards Act helps to guarantee a minimum rate of pay.
Overtime Pay
The act also stipulates that employees must receive overtime pay of at least 1.5 times more than their regular pay rate once they surpass 40 hours worked each week.
Youth Employment
There are provisions that are designed to protect the educational opportunities of minors while preventing any young people positioned in employment from working conditions that are deemed detrimental to their health or well-being.
Recordkeeping
Employers must also keep accurate employment records for every member of staff who isn’t exempt from FLSA employment laws, including metrics like hours worked and wages paid.
What if Employers Don’t Comply?
If an employer is found to be noncompliant with the Fair Labor Standards Act, they could be forced to back pay any outstanding minimum wage or overtime contributions, as well as an equal amount in liquidated damages.
For those contravening the act, there could also be civil penalties of up to $1,000 for each violation concerning underage workers or repeated willful minimum wage and overtime payment shortcomings.
In some cases, criminal charges could be brought against employers, which may result in further fines and even imprisonment.
How FLSA Overtime Eligibility Works
For non-exempt employees, FLSA rules on overtime pay are generally based on employee classification. Generally, an employee must earn less than $684 per week ($35,568 per year) and be paid hourly.
Furthermore, the nature of the work should not involve executive, administrative, or professional duties as stipulated in the FLSA guidelines.
Recordkeeping Obligations for Employers
It’s the duty of employers to maintain accurate records for each non-exempt employee under FLSA rules. The information they are required to keep includes:
- The occupation of the employee
- Start times for their working week
- Hours worked each day and workweek
- How salary is paid
- Hourly pay rates
- Total daily or weekly straight-time earnings plus overtime earnings
- Any additions or deductions to wages
- Total wages paid
Employers must keep their records for at least three years. Additionally, payroll records need to be kept on the employer’s premises for inspection should the Department of Labor (DOL) launch an inspection.
FAQs
No. The FLSA applies only to employment relationships, with independent contractors, interns, and volunteers defined as non-employee relationships.
No. The FLSA doesn’t govern vacation, holiday, severance, or sick pay. The act also doesn’t cover meal or rest periods, weekend work, pay rises or fringe benefits, or discharge notices.