11

Fair Labor Standards Act Fair Labor Standards Act (FLSA)(FLSA)

Presented by the Presented by the

U.S. Department of Labor U.S. Department of Labor

Wage & Hour DivisionWage & Hour Division

22

US. Department of LaborUS. Department of Labor

Danielle Clifton and Tatiana AnthonyDanielle Clifton and Tatiana Anthony

Wage and Hour DivisionWage and Hour Division

33

Major ProvisionsMajor Provisions

• Minimum WageMinimum Wage

• Overtime PayOvertime Pay

• Child LaborChild Labor

• RecordkeepingRecordkeeping

44

Employees of State and Employees of State and local governments are local governments are covered by the FLSA covered by the FLSA (section 3(s)(1)(C)).(section 3(s)(1)(C)).

77

VolunteersVolunteers

Individuals performing volunteer Individuals performing volunteer services for units of State and services for units of State and local governments are not local governments are not regarded as ``employees'' under regarded as ``employees'' under the statute. the statute.

88

Volunteers (continued)Volunteers (continued)

An individual who performs hours An individual who performs hours of service for a public agency for of service for a public agency for civic, charitable, or humanitarian civic, charitable, or humanitarian reasons, without promise, reasons, without promise, expectation or receipt of expectation or receipt of compensation for services compensation for services rendered, is considered to be a rendered, is considered to be a volunteer during such hours. volunteer during such hours.

99

Public Sector Volunteers Public Sector Volunteers

• With Same EmployerWith Same Employer– May volunteer in any capacity other than May volunteer in any capacity other than

to do their normal jobto do their normal job– May not volunteer to perform the services May not volunteer to perform the services

which they are employed to performwhich they are employed to perform

• With Different EmployerWith Different Employer– May volunteer to perform the same May volunteer to perform the same

services that they are employed to services that they are employed to perform by another employerperform by another employer

1010

Private Sector VolunteersPrivate Sector Volunteers

Individuals who volunteer or donate their Individuals who volunteer or donate their services:services:

for public service, religious, or for public service, religious, or humanitarian objectiveshumanitarian objectives

not as employeesnot as employees

without contemplation of paywithout contemplation of pay

are not considered as employees of the are not considered as employees of the religious, charitable and similar nonprofit religious, charitable and similar nonprofit corporations which receive their servicescorporations which receive their services

1111

HOURS WORKEDHOURS WORKED

1212

Hours Worked IssuesHours Worked Issues

• Suffered or permitted to workSuffered or permitted to work

• Waiting timeWaiting time

• On-call timeOn-call time

• Meal and rest periodsMeal and rest periods

• Meetings, lecture and trainingMeetings, lecture and training

• Travel timeTravel time

• Sleep timeSleep time

1313

Suffered or PermittedSuffered or Permitted

Work not requested but Work not requested but suffered or permitted is work suffered or permitted is work time.time.

1414

Waiting Time is Counted as Waiting Time is Counted as Hours Worked When:Hours Worked When:

The employee is unable to use The employee is unable to use the time effectively for his the time effectively for his own purposes, and it is own purposes, and it is controlled by the employer.controlled by the employer.

1515

Waiting Time is Not Counted Waiting Time is Not Counted as Hours Worked When:as Hours Worked When:

The employee is completely The employee is completely relieved from duty, and the time relieved from duty, and the time is long enough to enable the is long enough to enable the employee to use it effectively for employee to use it effectively for his / her own purposes.his / her own purposes.

1616

Meal Periods are not Hours Meal Periods are not Hours Worked When:Worked When:

The employee is completely relieved of The employee is completely relieved of duties for the purpose of eating a meal.duties for the purpose of eating a meal.

Ordinarily 30 minutes or more is long Ordinarily 30 minutes or more is long enough for a bona-fide meal periodenough for a bona-fide meal period..

1717

Rest PeriodsRest Periods

Rest periods of short Rest periods of short duration (normally 5 to 20 duration (normally 5 to 20 minutes) are counted as minutes) are counted as hours worked.hours worked.

1818

Meetings, Lectures and Meetings, Lectures and Training are Not Hours Training are Not Hours Worked When:Worked When:

Attendance is outside regular working Attendance is outside regular working hours, hours, andand

Attendance is voluntary, Attendance is voluntary, andandThe course, lecture, or meeting is not job The course, lecture, or meeting is not job

related, related, andandThe employee does not perform any The employee does not perform any

productive work during attendanceproductive work during attendance

1919

Travel TimeTravel Time

•Ordinary home to work travel Ordinary home to work travel is not work timeis not work time

•Travel between job sites Travel between job sites during the normal work day is during the normal work day is work timework time

2020

Recordkeeping Recordkeeping Requirements of FLSARequirements of FLSA

The FLSA requires that all The FLSA requires that all employers subject to any employers subject to any provision of the Act make, provision of the Act make, keep and preserve certain keep and preserve certain

recordsrecords

2121

RecordkeepingRecordkeeping

• Maintaining good records is essential to Maintaining good records is essential to proper complianceproper compliance

• Records need not be kept in any particular Records need not be kept in any particular form and time clocks are not requiredform and time clocks are not required

• Payroll records must be kept for 3 years and Payroll records must be kept for 3 years and the time cards and wage computation the time cards and wage computation records must be kept for 2 yearsrecords must be kept for 2 years

• An accurate record of the hours worked each An accurate record of the hours worked each day and total hours worked each week is day and total hours worked each week is critical to avoiding hours worked problemscritical to avoiding hours worked problems

2222

Required RecordsRequired Records

• Employee’s name, home address, Employee’s name, home address, occupation, sex, and birth date if occupation, sex, and birth date if under 19 years of ageunder 19 years of age

• Hour and day when workweek beginsHour and day when workweek begins• Total hours worked each workday Total hours worked each workday

and each workweekand each workweek• Total daily or weekly straight time Total daily or weekly straight time

earningsearnings

2323

Required RecordsRequired Records

• Regular hourly pay rate for any week Regular hourly pay rate for any week when overtime is workedwhen overtime is worked

• Total overtime pay for the workweekTotal overtime pay for the workweek

• Deductions from or additions to Deductions from or additions to wageswages

• Total wages paid each pay periodTotal wages paid each pay period

• Date of payment and period coveredDate of payment and period covered

2424

Minimum WageMinimum Wage

• Covered, non-exempt employees must be paid Covered, non-exempt employees must be paid not less than the minimum wage for all hours not less than the minimum wage for all hours worked.worked.

• Currently $6.55 per hour/$7.25 as of July24, Currently $6.55 per hour/$7.25 as of July24, 2009.2009.

• Cash or equivalent – free and clearCash or equivalent – free and clear

2525

Overtime PayOvertime PayCovered, non-exempt Covered, non-exempt

employees must receive employees must receive one and one-half times one and one-half times

the regular rate of pay for the regular rate of pay for all hours worked over all hours worked over forty in a workweek.forty in a workweek.

2626

Regular RateRegular Rate

Is determined by dividing total Is determined by dividing total earnings in the workweek by earnings in the workweek by the total number of hours the total number of hours worked in the workweekworked in the workweek

May not be less than the May not be less than the applicable minimum wageapplicable minimum wage

2727

Regular Rate Regular Rate ExclusionsExclusions

•Sums paid as giftsSums paid as gifts

•Payments for time not workedPayments for time not worked

•Reimbursement for expensesReimbursement for expenses

•Discretionary bonuses Discretionary bonuses

•Profit sharing plansProfit sharing plans

•Retirement and insurance plansRetirement and insurance plans

•Overtime premium payments Overtime premium payments

•Stock optionsStock options

2828

Regular Rate (RR)Regular Rate (RR)

Step 1: Total Straight Time Earnings (MinusStep 1: Total Straight Time Earnings (Minus

Statutory Exclusions) Divided By Total Statutory Exclusions) Divided By Total Hours Worked = Hours Worked = Regular Regular

RateRate

Step 2: Step 2: Regular RateRegular Rate x .5 = Half Time Premium x .5 = Half Time Premium

Step 3: Half Time Premium x Overtime Hours Step 3: Half Time Premium x Overtime Hours = Total Overtime Premium Due = Total Overtime Premium Due

2929

Hourly Rate + Production Hourly Rate + Production BonusBonusTotal Hours = 48Total Hours = 48Hourly Rate = $9.00 Hourly Rate = $9.00 Bonus = $10Bonus = $10

48 hours x $9.00=48 hours x $9.00= $432.00$432.00Bonus Bonus ++ 10.00 10.00

$442.00$442.00

$442.00 / 48 hrs = $442.00 / 48 hrs = $9.21 (Regular Rate) $9.21 (Regular Rate)$9.21 x .5 = $4.61 $9.21 x .5 = $4.61 $4.61 x 8 hrs = $36.88 (Overtime Due)$4.61 x 8 hrs = $36.88 (Overtime Due)

3030

Different Hourly RatesDifferent Hourly Rates

Janitor Rate $8.50Janitor Rate $8.50 Janitor Hours Janitor Hours 2121Cook Rate $9.00Cook Rate $9.00 Cook Hours Cook Hours 26 26

21 hours x $8.50 21 hours x $8.50 = $178.50= $178.50 26 hours x $9.00 26 hours x $9.00 = = $234.00$234.00

$412.50$412.50

$412.50 / 47 hours $412.50 / 47 hours = $8.78 (Regular Rate)= $8.78 (Regular Rate) $8.78 x 0.5 $8.78 x 0.5 = $4.39= $4.39 $4.39 x 7 hours $4.39 x 7 hours = $30.73(Overtime Due)= $30.73(Overtime Due)

3131

Fixed Salary for Fluctuating Fixed Salary for Fluctuating HoursHoursFixed Salary Fixed Salary $420.00 (for all hours $420.00 (for all hours

worked)worked)

Week 1 Hours WorkedWeek 1 Hours Worked 49 49

Regular Rate $8.57 ($420 / 49 Regular Rate $8.57 ($420 / 49 hours)hours)

Additional Half-Time Rate $4.29Additional Half-Time Rate $4.29

Salary EqualsSalary Equals = $420.00= $420.00

9 hours x $4.299 hours x $4.29 = $38.61 (Overtime = $38.61 (Overtime Due)Due)

Total DueTotal Due = $458.61= $458.61

3232

Fixed Salary for Fluctuating Fixed Salary for Fluctuating HoursHours

Fixed Salary Fixed Salary $420.00 (for all hours $420.00 (for all hours worked)worked)

Week 2 Hours WorkedWeek 2 Hours Worked 41 41

Regular Rate $10.24 ($420 / 41 hours)Regular Rate $10.24 ($420 / 41 hours)

Additional Half-Time Rate $5.12Additional Half-Time Rate $5.12

Salary EqualsSalary Equals = $420.00= $420.00

1 hour x $5.121 hour x $5.12 = $5.12= $5.12

Total DueTotal Due = $425.12= $425.12

3333

Exemptions and Exemptions and ExceptionsExceptions

There are numerous exemptions There are numerous exemptions and exceptions from the and exceptions from the

minimum wage and/or overtime minimum wage and/or overtime standards of the FLSA. standards of the FLSA.

Overview of the Overview of the Final Part 541 RegulationsFinal Part 541 Regulations

Wage and Hour DivisionWage and Hour Division

Employment Standards Employment Standards AdministrationAdministration

U.S. Department of Labor U.S. Department of Labor

Fair Labor Standards ActFair Labor Standards Act

• Federal Minimum Wage: $5.15 per Federal Minimum Wage: $5.15 per hourhour

• Overtime: 1 ½ times the regular rate Overtime: 1 ½ times the regular rate of pay for all hours over 40 hours in a of pay for all hours over 40 hours in a work weekwork week

3636

““White Collar” ExemptionsWhite Collar” Exemptions• Section 13(a)(1) of the FLSA provides an Section 13(a)(1) of the FLSA provides an

exemption from both minimum wage and exemption from both minimum wage and overtime pay for employees who are overtime pay for employees who are employed in a bona fide:employed in a bona fide:– Executive;Executive;– Administrative;Administrative;– Professional; orProfessional; or– Outside Sales capacity.Outside Sales capacity.

• Certain computer employees may be exempt Certain computer employees may be exempt professionals under Section 13(a)(1) or professionals under Section 13(a)(1) or exempt under Section 13(a)(17) of the FLSA.exempt under Section 13(a)(17) of the FLSA.

3737

Scope of the ExemptionsScope of the Exemptions• New § 541.3(a): the exemptions do not apply New § 541.3(a): the exemptions do not apply

to manual laborers or other “blue collar” to manual laborers or other “blue collar” workersworkers

• New § 541.3(b): the exemptions do not apply New § 541.3(b): the exemptions do not apply to police officers, fire fighters, paramedics, to police officers, fire fighters, paramedics, emergency medical technicians and similar emergency medical technicians and similar public safety employeespublic safety employees

• New § 541.4: nothing in the final rule relieves New § 541.4: nothing in the final rule relieves employers from their obligations under union employers from their obligations under union contractscontracts

3838

Three Tests for ExemptionThree Tests for Exemption

• Salary Level TestSalary Level Test– A minimum amount of earningsA minimum amount of earnings

• Salary Basis TestSalary Basis Test– A predetermined salary which is not subject A predetermined salary which is not subject

to deductions because of the quality or to deductions because of the quality or quantity of workquantity of work

• Duties TestsDuties Tests– Performing managerial or professional job Performing managerial or professional job

duties as set forth in the regulationsduties as set forth in the regulations

3939

Salary Level TestSalary Level Test• Minimum Salary Level: $455 per weekMinimum Salary Level: $455 per week

• Highly Compensated LevelHighly Compensated Level– Total annual compensation of at least $100,000Total annual compensation of at least $100,000– At least $455 per week paid on a salary or fee At least $455 per week paid on a salary or fee

basisbasis– Perform office or non-manual workPerform office or non-manual work– Customarily and regularly perform any one or Customarily and regularly perform any one or

more of the exempt duties identified in the more of the exempt duties identified in the standard tests for the executive, administrative standard tests for the executive, administrative or professional exemptionsor professional exemptions

4040

Salary Basis TestSalary Basis Test

• Regularly receives a predetermined amount Regularly receives a predetermined amount of compensation each pay period of compensation each pay period

• The compensation cannot be reduced The compensation cannot be reduced because of variations in the quality or because of variations in the quality or quantity of the work performedquantity of the work performed

• Must be paid the full salary for any week in Must be paid the full salary for any week in which the employee performs which the employee performs anyany work work

• Need not be paid for any workweek when Need not be paid for any workweek when no work is performedno work is performed

4141

Changes to Salary Basis Changes to Salary Basis TestTest

• Deductions allowed for unpaid disciplinary Deductions allowed for unpaid disciplinary suspensions of one or more full days imposed in good suspensions of one or more full days imposed in good faith for violations of written workplace conduct rulesfaith for violations of written workplace conduct rules

• Isolated or inadvertent improper deductions will not Isolated or inadvertent improper deductions will not result in the lost of the exemption if the employee is result in the lost of the exemption if the employee is reimbursedreimbursed

• An actual practice of making improper deductions will An actual practice of making improper deductions will result in the loss of the exemption only for:result in the loss of the exemption only for:– Employees in the same job classifications Employees in the same job classifications – Working for the same manager who made the improper Working for the same manager who made the improper

deductionsdeductions

4242

New Safe HarborNew Safe Harbor• Exemption will not be lost if:Exemption will not be lost if:

– The employer has a clearly communicated policy The employer has a clearly communicated policy prohibiting improper deductions and including a prohibiting improper deductions and including a complaint mechanismcomplaint mechanism

– Employees are reimbursed for any improper Employees are reimbursed for any improper deductions; anddeductions; and

– The employer makes a good faith commitment to The employer makes a good faith commitment to comply in the futurecomply in the future

• UnlessUnless the employer willfully violates the policy the employer willfully violates the policy by continuing to make improper deductions by continuing to make improper deductions after receiving employee complaintsafter receiving employee complaints

4343

Executive DutiesExecutive Duties• Primary duty is management of the Primary duty is management of the

enterprise or of a customarily recognized enterprise or of a customarily recognized department or subdivision; department or subdivision;

• Customarily and regularly directs the work Customarily and regularly directs the work of two or more other employees; andof two or more other employees; and

• Authority to hire or fire other employees or Authority to hire or fire other employees or whose suggestions and recommendations whose suggestions and recommendations as to hiring, firing, advancement, promotion as to hiring, firing, advancement, promotion or other change of status of other or other change of status of other employees are given particular weight.employees are given particular weight.

4444

Changes to ExecutiveChanges to Executive

• The final rule includes a new definition of The final rule includes a new definition of the term “particular weight”the term “particular weight”

• The final rule provides that concurrent The final rule provides that concurrent performance of exempt and nonexempt performance of exempt and nonexempt work does not automatically disqualify an work does not automatically disqualify an employee from exemptionemployee from exemption

• The final rule provides that owners of a The final rule provides that owners of a bona fide 20% equity interest in an bona fide 20% equity interest in an enterprise are exempt they are “actively enterprise are exempt they are “actively engaged in its management”engaged in its management”

4545

Administrative DutiesAdministrative Duties

• Whose primary duty is the performance Whose primary duty is the performance of office or non-manual work directly of office or non-manual work directly related to the management or general related to the management or general business operations of the employer or business operations of the employer or the employer’s customers; andthe employer’s customers; and

• Whose primary duty includes the Whose primary duty includes the exercise of discretion and independent exercise of discretion and independent judgment with respect to matters of judgment with respect to matters of significance.significance.

4646

Changes to AdministrativeChanges to Administrative• The final rule adds new examples for insurance The final rule adds new examples for insurance

claims adjusters, financial services employees claims adjusters, financial services employees and public sector inspectorsand public sector inspectors

• The final rule adds a new section explaining The final rule adds a new section explaining that the exemption is not lost for employees that the exemption is not lost for employees who use manuals that:who use manuals that:– Contain or relate to highly technical, scientific, legal, Contain or relate to highly technical, scientific, legal,

financial or other similarly complex matters; and financial or other similarly complex matters; and – Can be understood or interpreted only by those with Can be understood or interpreted only by those with

advanced or specialized knowledge or skillsadvanced or specialized knowledge or skills

4747

Professional ExemptionProfessional Exemption• Learned ProfessionalLearned Professional

– Primary duty of the performance of work requiring Primary duty of the performance of work requiring knowledge of an advanced type in a field of knowledge of an advanced type in a field of science or learning customarily acquired by a science or learning customarily acquired by a prolonged course of specialized intellectual prolonged course of specialized intellectual instructioninstruction

• Creative ProfessionalCreative Professional– Primary duty of the performance of work requiring Primary duty of the performance of work requiring

invention, imagination, originality or talent in a invention, imagination, originality or talent in a recognized field of artistic or creative endeavorrecognized field of artistic or creative endeavor

4848

Changes to ProfessionalChanges to Professional• The final rule defines “work requiring The final rule defines “work requiring

advanced knowledge” as “work which is advanced knowledge” as “work which is predominantly intellectual in character and predominantly intellectual in character and which includes work requiring the consistent which includes work requiring the consistent exercise of discretion and judgment”exercise of discretion and judgment”

• The final rule clarifies that licensed practical The final rule clarifies that licensed practical nurses and paralegals are not exempt nurses and paralegals are not exempt learned professionalslearned professionals

• The final rule provides that dental hygienists, The final rule provides that dental hygienists, physician assistants, chefs and athletic physician assistants, chefs and athletic trainers are exempt learned professionalstrainers are exempt learned professionals

4949

FLSA Section 13(b)(20)FLSA Section 13(b)(20)

Law enforcement or fire protection Law enforcement or fire protection employees of a public agency which employees of a public agency which employs less than five employees in employs less than five employees in law enforcement or fire protection law enforcement or fire protection activities are not subject to FLSA activities are not subject to FLSA overtime.overtime.

5050

SECTION 7 (K)SECTION 7 (K)

5151

Work PeriodWork Period

A "work period" may be from 7 A "work period" may be from 7 consecutive days to 28 consecutive days consecutive days to 28 consecutive days in length. For example, fire protection in length. For example, fire protection personnel are due overtime under such a personnel are due overtime under such a plan after 212 hours worked during a 28-plan after 212 hours worked during a 28-day period, while law enforcement day period, while law enforcement personnel must receive overtime after personnel must receive overtime after 171 hours worked during a 28-day 171 hours worked during a 28-day period..period..

5252

Additional ExamplesAdditional Examples

Maximum hours standardsMaximum hours standards

Work period (days) Work period (days) Fire Fire Law Law

Protection Protection EnforcementEnforcement

-------------------------------------------------------- --------------------------------------------------------

28 Days28 Days 212212 171171

21 Days21 Days 159159 128128

14 Days14 Days 106106 86867 Days7 Days 5353 4343

5353

Overtime Exception-Overtime Exception-Compensatory TimeCompensatory Time

Under certain prescribed Under certain prescribed conditions, employees of State or conditions, employees of State or local government agencies may local government agencies may receive compensatory time off at a receive compensatory time off at a rate of not less than one and one-rate of not less than one and one-half hours for each overtime hour half hours for each overtime hour worked, instead of cash overtime worked, instead of cash overtime pay. pay.

5454

Compensatory Time Compensatory Time (continued)(continued)

Police and fire fighters, Police and fire fighters, emergency response personnel, emergency response personnel, and employees engaged in and employees engaged in seasonal activities may accrue seasonal activities may accrue up to 480 hours of comp time; all up to 480 hours of comp time; all others, 240 hours.others, 240 hours.

5555

Compensatory Time (cont.)Compensatory Time (cont.)

An employee should be An employee should be permitted to use compensatory permitted to use compensatory time within a reasonable period time within a reasonable period after making the request, if after making the request, if doing so does not "unduly doing so does not "unduly disrupt" the operations of the disrupt" the operations of the employer.employer.

5656

Compensatory Time (cont.)Compensatory Time (cont.)

At the time of termination an At the time of termination an employee must be paid the higher of employee must be paid the higher of (1) his/her final regular rate of pay or (1) his/her final regular rate of pay or (2) the average regular rate during (2) the average regular rate during his\her last three years of his\her last three years of employment for any compensatory employment for any compensatory time remaining "on the books" when time remaining "on the books" when termination occurs.termination occurs.

5757

Overtime Exception-Overtime Exception-Occasional & Sporadic Occasional & Sporadic EmploymentEmployment Employees who solely at their Employees who solely at their

own option occasionally or own option occasionally or sporadically work on a part-time sporadically work on a part-time basis for the same public agency basis for the same public agency in a different capacity than the in a different capacity than the one in which they are normally one in which they are normally employedemployed

5858

Overtime Exception - Overtime Exception - SubstitutionSubstitution

Employees at their option with Employees at their option with approval of the agency, who approval of the agency, who substitute for one another substitute for one another during scheduled work hours during scheduled work hours in the same work capacity are in the same work capacity are not due overtime.not due overtime.

5959

Child Labor InChild Labor In

Non-Agricultural Industries Non-Agricultural Industries Or OccupationsOr Occupations

6060

Child Labor ProvisionsChild Labor Provisions

The FLSA child labor provisions The FLSA child labor provisions are designed to protect the are designed to protect the educational opportunities of educational opportunities of minors and prohibit their minors and prohibit their employment in jobs and under employment in jobs and under conditions detrimental to their conditions detrimental to their health or well-being.health or well-being.

6161

Child LaborChild Labor

The federal child labor regulations The federal child labor regulations establish both hours and establish both hours and occupational standards for youth. occupational standards for youth.

6262

Minimum Age Minimum Age StandardsStandards

• 18 and above18 and above– No limitationsNo limitations– Minimum for occupations Minimum for occupations

declared hazardous by the declared hazardous by the Department of LaborDepartment of Labor

6363

Minimum Age Minimum Age StandardsStandards

• 16 and 17 year-olds16 and 17 year-olds– Limited to non-hazardous Limited to non-hazardous

occupationsoccupations– No limitations on hours or timeNo limitations on hours or time

6464

Minimum Age Minimum Age StandardsStandards

• 14- and 15-year-olds14- and 15-year-olds– Minimum age for employment Minimum age for employment

in limited occupationsin limited occupations– Limited to work outside school Limited to work outside school

hourshours– Total work hours limited per day Total work hours limited per day

and per weekand per week

6565

Minimum Age Minimum Age StandardsStandards

• Under 14 years of ageUnder 14 years of age– Work only in jobs that are exempt from Work only in jobs that are exempt from

or are not covered by the FLSAor are not covered by the FLSA

ExamplesExamples: Delivering newspapers to the : Delivering newspapers to the consumer, acting, working around consumer, acting, working around private homes performing minor chores private homes performing minor chores or baby-sittingor baby-sitting

6666

Child Labor PenaltiesChild Labor Penalties

• Employers are subject to civil Employers are subject to civil money penalties of up to $11,000 money penalties of up to $11,000 for each child labor violationfor each child labor violation

• The amount of the penalty is The amount of the penalty is determined by the size of the determined by the size of the business and the gravity of the business and the gravity of the violationviolation

6767

Common Errors to Common Errors to AvoidAvoid

6868

Common Errors to Common Errors to AvoidAvoid

• Assuming that all employees paid a Assuming that all employees paid a salary are not due overtimesalary are not due overtime

• Improperly applying an exemptionImproperly applying an exemption• Failing to pay for all hours an Failing to pay for all hours an

employee is “suffered or permitted” to employee is “suffered or permitted” to workwork

• Limiting the number of hours Limiting the number of hours employees are allowed to recordemployees are allowed to record

6969

Common ErrorsCommon Errors to Avoid to Avoid

• Failure to pay for pre or Failure to pay for pre or post shift work activities post shift work activities

• Confusing federal and state lawConfusing federal and state law• Improperly applying an exemptionImproperly applying an exemption• Failure to include all types of pay Failure to include all types of pay

received in calculating an received in calculating an employee’s regular rate for OTemployee’s regular rate for OT

• Treating an employee as an Treating an employee as an independent contractorindependent contractor

7070

Common ErrorsCommon Errors to Avoid to Avoid

• Not totaling work done in separate Not totaling work done in separate employer establishments when employer establishments when calculating OT duecalculating OT due

• Making illegal deductions from wages Making illegal deductions from wages -- shortages, drive-offs, damage, -- shortages, drive-offs, damage, tools, uniforms, etc. -- that cut into tools, uniforms, etc. -- that cut into the required MW or OTthe required MW or OT

• Deducting rest breaks from work Deducting rest breaks from work hourshours

7171

Common ErrorsCommon Errors to Avoid to Avoid

• Employee works during meal break Employee works during meal break and is not paidand is not paid

• Employee takes work home and the Employee takes work home and the hours are not recorded or paid hours are not recorded or paid

• Not paying for compensable travel Not paying for compensable travel timetime

• Not paying for employee meetingsNot paying for employee meetings

7272

The FLSA Does Not The FLSA Does Not RequireRequire

• Vacation, holiday, severance or sick payVacation, holiday, severance or sick pay• Meal or rest periods, holidays off, or Meal or rest periods, holidays off, or

vacationsvacations• Premium pay for weekend or holiday workPremium pay for weekend or holiday work• A discharge notice, reason for discharge, or A discharge notice, reason for discharge, or

immediate payment of final wages to immediate payment of final wages to terminated employeesterminated employees

• Any limit on the number of hours in a day Any limit on the number of hours in a day or days in a week an employee at least 16 or days in a week an employee at least 16 years old may be required or scheduled to years old may be required or scheduled to workwork

• Pay raises or fringe benefitsPay raises or fringe benefits

7373

EnforcementEnforcement• FLSA enforcement is carried out by Wage FLSA enforcement is carried out by Wage

and Hour staff throughout the U.S.and Hour staff throughout the U.S.

• Where violations are found, Wage and Hour Where violations are found, Wage and Hour advises employers of the steps needed to advises employers of the steps needed to correct violations, achieves agreement to correct violations, achieves agreement to comply in the future and supervises comply in the future and supervises voluntary payment of back wages as voluntary payment of back wages as applicable.applicable.

• A 2-year statute of limitations generally A 2-year statute of limitations generally applies to the recovery of back pay. In the applies to the recovery of back pay. In the case of a willful violation, a 3-year statute of case of a willful violation, a 3-year statute of limitations may apply.limitations may apply.

7474

EnforcementEnforcement

In the event there is not a voluntary In the event there is not a voluntary agreement to comply and/or pay back agreement to comply and/or pay back wages, the Wage and Hour Division may:wages, the Wage and Hour Division may:

• Obtain an injunction to restrain the Obtain an injunction to restrain the employer from violating the FLSA, employer from violating the FLSA, including the withholding of proper including the withholding of proper minimum wage and overtimeminimum wage and overtime

• Bring suit for back wages and an equal Bring suit for back wages and an equal amount as liquidated damagesamount as liquidated damages

7575

PenaltiesPenalties

• Employers who willfully violate the Act may be Employers who willfully violate the Act may be prosecuted criminally and fined up to $11,000prosecuted criminally and fined up to $11,000

• Employers who violate the child labor Employers who violate the child labor provisions are subject to a civil money penalty provisions are subject to a civil money penalty of up to $11,000 for each employee who was of up to $11,000 for each employee who was the subject of a violationthe subject of a violation

• Employers who willfully or repeatedly violate Employers who willfully or repeatedly violate the minimum wage or overtime pay the minimum wage or overtime pay requirements are subject to a civil money requirements are subject to a civil money penalty of up to $1100 for each such violationpenalty of up to $1100 for each such violation

7676

ADDITIONAL ADDITIONAL INFORMATIONINFORMATION

• Visit the WHD homepage at: Visit the WHD homepage at: www.dol.gov/dol/esa/public/whd_org.htmwww.dol.gov/dol/esa/public/whd_org.htm

• Call the WHD toll-free information and Call the WHD toll-free information and helpline at helpline at 1-866--487-92431-866--487-9243

• Use the DOL interactive advisor system -Use the DOL interactive advisor system - ELAWS ELAWS ((EEmployment mployment LLaws aws AAssistance for ssistance for WWorkers and orkers and SSmall Businesses)mall Businesses) at: at: www.dol.gov/elawswww.dol.gov/elaws

• Call or visit the nearest Wage and Hour Call or visit the nearest Wage and Hour Division OfficeDivision Office

For More InformationFor More Information• Other resources on the Part 541 exemptions Other resources on the Part 541 exemptions

are available at are available at www.dol.gov\fairpaywww.dol.gov\fairpay– RegulationsRegulations– PreamblePreamble– Fact SheetsFact Sheets– Field Operations HandbookField Operations Handbook– Frequently Asked QuestionsFrequently Asked Questions

• To ask a specific question or register a To ask a specific question or register a comment:comment:– Email: fairpay@dol.govEmail: fairpay@dol.gov– Telephone, toll-free: 1-866-4US-WAGETelephone, toll-free: 1-866-4US-WAGE