Fair Labor Standards Act (FLSA)

1. Fair Labor Standards Act (FLSA) Presented by the U.S. Department of Labor Wage & Hour Division

2. Major Provisions Minimum Wage Overtime Pay Child Labor Recordkeeping

3. Coverage

4. Coverage under the FLSA Individual Enterprise

5. Enterprise Coverage • A firm with an annual dollar volume of sales or business done of at least $500,000 or • Is engaged in the operation of: • A hospital • A nursing home

6. Enterprise Coverage • A school for mentally or physically handicapped or gifted children • A public or private elementary or secondary school or institution of higher education (profit or non-profit) • A pre-school, or is • A Federal, State, or local government agency

7. Individual Coverage • Employees engaged in • Interstate Commerce or • The production of goods for interstate commerce or • In a closely-related process or occupation directly essential (CRADE) to such production

8. Minimum Wage

9. Minimum Wage • Covered, non-exempt employees must be paid not less than the MW for all hours worked • Currently $6.55 per hour • Cash or equivalent – free and clear • Each week stands by itself, although there is no requirement to pay weekly

10. Minimum Wage • What counts as contributing to the MW: • Wages (salary, hourly pay, commissions, piece rate earnings) • Reasonable cost of room, board and other “facilities” provided by the employer for the employee’s benefit • Tips (currently up to $4.42 per hour) received by eligible tipped employees

11. Deductions Deductions made primarily for the benefit or convenience of the employer for such items as: • Cash or merchandise shortages • Employer required uniforms • Tools of the trade Are illegal to the extent that they reduce the wages of employees below the MW or reduce the amount of OT pay due

12. Overtime Pay

13. Overtime Pay • Due to covered, non-exempt employees • Calculated at time and one-half the employee’s regular rate of pay • Required for each hour worked in a workweek in excess of the maximum allowable in the given type of employment (usually 40 hours per workweek) • Workweeks may not be averaged

14. Overtime Pay • Regular Rate (RR) • It is a rate per hour • Is determined by dividing total earnings for all hours worked in any work week by the total number of hours worked in the week • It may not be less than the applicable MW • If RR is higher than the MW, OT must be computed at the higher rate

15. Overtime Pay • Regular Rate (continued) Includes all remuneration for employment except: • Gifts, such as Christmas or Birthday money • Payments for time not worked, such as holiday or vacation pay • Discretionary bonuses • Profit sharing plans • Talent fees • Premium payments • Stock options

16. Compensatory Time Off Instead of Overtime Pay (“Comp Time”) • Private employers may not use comp time to meet FLSA OT requirements • Public Agencies may offer comp time if: • Provided at one and one half hours off with pay for each hour of overtime worked • Done pursuant to a CBA or prior agreement • Accrued time does not exceed maximums

17. Exemptions

18. Child Labor

19. Minimum Age Standards • 18 and above • No limitations • Minimum for occupations declared hazardous by the Department of Labor • 16 and 17 year-olds • General minimum for employment • Limited to non hazardous occupations • No limitations on hours or time

20. Minimum Age Standards(Continued) • 14 and 15 year-olds • Minimum age for employment in specified occupations • Limited to work outside school hours • Total work hours limited per day and per week • Only non-hazardous and non-manufacturing jobs • Under 14 years of age • Work only in jobs that are exempt from or are not covered by the FLSA • NOTE: Rules differ in agricultural employment

21. Public Sector Volunteers • With Same Employer • May volunteer in any capacity other than to do their normal job • May not volunteer to perform the services which they are employed to perform • With Different Employer • May volunteer to perform the same services that they are employed to perform by another employer

22. Private Sector Volunteers Individuals who volunteer or donate their services: for public service, religious, or humanitarian objectives not as employees without contemplation of pay are not considered as employees of the religious, charitable and similar nonprofit corporations which receive their services

23. Hours Worked Under the FLSA • Covered, non-exempt employees must be paid for all hours worked in a workweek • “Hours Worked,” generally include all the time an employee is: Required to be on duty Required to be on the employer’s premises, or any other prescribed place of work Allowed (suffered or permitted) to work

24. Hours Worked Under the FLSA It is the duty of management to exercise its control to see that work is not performed if it does not want it to be performed

25. Examples of FLSAHours Worked Attendance at meetings, lectures, training programs and similar activities unless all of the following criteria are met:  Attendance is outside the employee’s regular working hours  Attendance is voluntary  Activity is not related to the employee’s job  No productive work is done during the activity

26. Examples of FLSAHours Worked • Work done in the home if the employer knows or has reason to believe the work is being performed • Work done during lunch periods • Work done before or after scheduled hours • Rest periods of 20 minutes or less

27. Examples of FLSAHours Worked • Get ready work prior to the start of the shift • Clean up work after the end of a shift • The entire meal period, if the employee is not completely relieved from all duties and responsibilities • Transporting or delivering materials or equipment to a job site prior to the start of the workday

28. Examples of FLSAHours Worked • Returning materials or equipment after the end of the workday • Transporting employees to worksites, office, or to their homes, either before or after the paid workday, at management’s request or directive • Travel from job site to job site during the workday

29. Examples of FLSA Hours Worked • “On call” time by an employee who must remain on the employer’s premises or so close thereto that he/she cannot use the time effectively for his/her own purposes

30. Recordkeeping

31. Recordkeeping • Maintaining good records is essential to proper compliance • Records need not be kept in any particular form and time clocks are not required • Payroll records must be kept for 3 years and the time cards and wage computation records must be kept for 2 years • An accurate record of the hours worked each day and total hours worked each week is critical to avoiding hours worked problems

32. Required Records • Employee’s name, home address, occupation, sex, and birth date if under 19 years of age • Hour and day when workweek begins • Total hours worked each workday and each workweek • Total daily or weekly straight time earnings

33. Required Records • Regular hourly pay rate for any week when overtime is worked • Total overtime pay for the workweek • Deductions from or additions to wages • Total wages paid each pay period • Date of payment and period covered

34. Common Errors to Avoid • Assuming that paying a salary automatically makes an employee “exempt” • Failing to pay for all hours an employee is “suffered or permitted” to work • Limiting employees to reporting 40 hours (or limited overtime) and directing them to “get the job done” and ignoring the time it takes to accomplish the task

35. Common Errors to Avoid • Failure to pay for pre or post shift work activities • Confusing federal and state law • Improperly applying an exemption • Failure to include all types of pay received in calculating an employee’s regular rate for OT • Treating an employee as an independent contractor

36. Common Errors to Avoid • Not totaling work done in separate employer establishments when calculating OT due • Making illegal deductions from wages -- shortages, drive-offs, damage, tools, uniforms, etc. -- that cut into the required MW or OT • Deducting rest breaks from work hours

37. Common Errors to Avoid • Employee works during meal break and is not paid • Employee takes work home and the hours are not recorded or paid • Not paying for compensable travel time • Not paying for employee meetings

38. The FLSA Does Not Require • Vacation, holiday, severance or sick pay • Meal or rest periods, holidays off, or vacations • Premium pay for weekend or holiday work • A discharge notice, reason for discharge, or immediate payment of final wages to terminated employees • Any limit on the number of hours in a day or days in a week an employee at least 16 years old may be required or scheduled to work • Pay raises or fringe benefits

39. ADDITIONALINFORMATION • Visit the WHD homepage at: www.wagehour.dol.gov • Call the WHD toll-free information and help-line at 1-866-487-9243 • Use the DOL interactive advisor system -ELAWS(Employment Laws Assistance for Workers and Small Businesses at: www.dol.gov/elaws • Call or visit the nearest Wage and Hour Division Office

40. OTHER MAJOR WAGE-HOUR DIVISION ADMINISTERED LAWS Government Contracts • Davis-Bacon and Related Acts (DBRA) • Walsh-Healey Public Contracts Act (PCA) • McNamara-O'Hara Service Contract Act (SCA) • Contract Work Hours and Safety Standards Act (CWHSSA) • Copeland “Anti-Kickback” Act

41. OTHER MAJOR WAGE-HOUR DIVISION ADMINISTERED LAWS- CONTINUED Agricultural Employment • Migrant and Seasonal Agricultural Worker Protection Act (MSPA) • Field Sanitation Provisions of OSHAct • H-2A, Agricultural Guest-Worker Provisions, of Immigration and Nationality Act (INA)

42. OTHER MAJOR WAGE-HOUR DIVISION ADMINISTERED LAWS- CONTINUED Immigration and Nationality Act • I-9 Provisions (Work eligibility verification) and Contractual Obligations for • D-1 (Alien Crewmembers Performing Longshore Activities) • H-1B (Specialty Occupations)

43. OTHER MAJOR WAGE-HOUR DIVISION ADMINISTERED LAWS- CONTINUED Miscellaneous • Family and Medical Leave Act (FMLA) • Wage Garnishment Provisions of Consumer Credit Protection Act (CCPA) • Employee Polygraph Protection Act (EPPA) • Wage Provisions of National Foundation on the Arts and Humanities Act