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

Employment Services 303-492-6475Employment Services 303-492-6475

Training OutlineTraining Outline What is FLSA?What is FLSA? Who does FLSA apply to?Who does FLSA apply to? How is overtime eligibility determined?How is overtime eligibility determined? When can a position be exempt from When can a position be exempt from

overtime?overtime? When, where and how is overtime When, where and how is overtime

calculated and paid?calculated and paid? What records do I need?What records do I need? Who does what? Who does what? Will I remember all this? Will I remember all this?

What is FLSA? What is FLSA?

Fair Labor Standards Act (FLSA) Fair Labor Standards Act (FLSA) est.1938est.1938 governs many areas. Those areas governs many areas. Those areas most important to us may be:most important to us may be: Minimum wage Minimum wage

Colorado: $7.28 per hour effective 1/1/09Colorado: $7.28 per hour effective 1/1/09 Federal: $7.25 per hour effective 7/24/09Federal: $7.25 per hour effective 7/24/09

Exemption Criteria Exemption Criteria Overtime (OTM) Pay Overtime (OTM) Pay Record keeping requirementsRecord keeping requirements

Who does FLSA apply to?Who does FLSA apply to?

Employment relationship between an Employment relationship between an “employer” and an “employee”, “employer” and an “employee”, including:including: Classified employeesClassified employees Exempt-Professional employeesExempt-Professional employees Faculty and Research employeesFaculty and Research employees Student employeesStudent employees Temporary employeesTemporary employees

All employees are “covered”, but All employees are “covered”, but some may be exempt from OTM or some may be exempt from OTM or minimum wage requirementsminimum wage requirements

DefinitionsDefinitions

FLSA:FLSA: ExemptExempt = NOT eligible for overtime = NOT eligible for overtime

Not entitled to additional compensation for Not entitled to additional compensation for hours worked over 40 in a work weekhours worked over 40 in a work week

Non-ExemptNon-Exempt = ELIGIBLE for overtime = ELIGIBLE for overtime MUST be compensated (in salary or time off) MUST be compensated (in salary or time off)

at the rate of time-and-a-half for all hours at the rate of time-and-a-half for all hours worked over 40 in a work weekworked over 40 in a work week

Colorado State Personnel System:Colorado State Personnel System: Exempt = Not Exempt = Not classifiedclassified, i.e., exempt , i.e., exempt

from the state personnel systemfrom the state personnel system (exempt-professional employees)(exempt-professional employees)

How is overtime eligibility determined?How is overtime eligibility determined?

Classified StaffClassified Staff Employment Services designates overtime Employment Services designates overtime

status of each position. Usually will be status of each position. Usually will be documented on classification decision notice.documented on classification decision notice.

Officer & Exempt Professional StaffOfficer & Exempt Professional Staff Overtime status reviewed and determined by Overtime status reviewed and determined by

Employment Services at time position is created Employment Services at time position is created based on duties of jobbased on duties of job

FacultyFaculty Typically exempt from OTTypically exempt from OT

Student EmployeesStudent Employees Typically eligible for OT Typically eligible for OT

When can a position be exempt from When can a position be exempt from overtime?overtime?

Salary BasisSalary Basis must be paid on a salaried basis, not must be paid on a salaried basis, not

hourly (except for teachers, doctors, hourly (except for teachers, doctors, lawyers, and computer professionals lawyers, and computer professionals currently paid at least $27.63/hr)currently paid at least $27.63/hr)

Minimum Salary ThresholdMinimum Salary Threshold Currently must be paid a minimum of Currently must be paid a minimum of

$455 per week or $23,660 per year $455 per week or $23,660 per year (except for teachers, doctors, and (except for teachers, doctors, and lawyers)lawyers)

Job Duties TestJob Duties Test must also be assigned job must also be assigned job

responsibilities that fall into one of the responsibilities that fall into one of the categories for exemptioncategories for exemption

Exemption CategoriesExemption Categories

ExecutiveExecutive Administrative – regular and Administrative – regular and

academicacademic ProfessionalProfessional

Learned Professional – doctors, lawyers, Learned Professional – doctors, lawyers, teachersteachers

Creative Professional – artists, musicians, Creative Professional – artists, musicians, creative writerscreative writers

Computer EmployeeComputer Employee Outside SalespersonOutside Salesperson Highly CompensatedHighly Compensated

Employee makes more than $100,000 per Employee makes more than $100,000 per year and meets other exemption criteriayear and meets other exemption criteria

Exempt PositionsExempt Positions

NOTNOT eligible for OT due to salary and level eligible for OT due to salary and level of responsibilitiesof responsibilities

May be required to complete time records May be required to complete time records and must track use of leaveand must track use of leave

Appointing authority can schedule work Appointing authority can schedule work hourshours

Full-time public employees expected to Full-time public employees expected to work minimum 40 hours a weekwork minimum 40 hours a week

Administrative leave or incentive awards Administrative leave or incentive awards may be used to compensate extraordinary may be used to compensate extraordinary efforts but not tied to hours workedefforts but not tied to hours worked

When is overtime paid?When is overtime paid?

Overtime is paid when more Overtime is paid when more than 40 hours are worked in a than 40 hours are worked in a work weekwork week

Standard CU Workweek = Standard CU Workweek = Sunday 12:01 a.m. through Sunday 12:01 a.m. through

Saturday midnightSaturday midnight

How is overtime compensated?How is overtime compensated?

1 ½ times the regular rate of pay 1 ½ times the regular rate of pay for allfor all hours worked over 40 in a hours worked over 40 in a work weekwork week

Paid as salary or compensatory Paid as salary or compensatory time off in lieu of cash if time off in lieu of cash if agreement has been signedagreement has been signed

Additional Comp Time infoAdditional Comp Time info

Comp Time AgreementComp Time Agreement Should be condition of hire in offer letter Should be condition of hire in offer letter

or overtime policyor overtime policy Comp time is Comp time is NOTNOT leave, but a form leave, but a form

of compensationof compensation Must be scheduled as soon as Must be scheduled as soon as

practicalpractical Comp time balance is paid out upon Comp time balance is paid out upon

transfer or termination or when transfer or termination or when balance exceeds 240 hoursbalance exceeds 240 hours

Where is overtime paid?Where is overtime paid? Overtime in HRMS Time Collection:Overtime in HRMS Time Collection:

Enter total number of hours worked in Enter total number of hours worked in excess of 40 hrs/wk using appropriate excess of 40 hrs/wk using appropriate earnings code:earnings code:

OTM – OvertimeOTM – Overtime SOT – Student OvertimeSOT – Student Overtime

HRMS will calculate the 1 ½ rateHRMS will calculate the 1 ½ rate

Example:Example: Larry works 4 hrs overtimeLarry works 4 hrs overtime PPL enters 4 hrs OTM or SOT in Time PPL enters 4 hrs OTM or SOT in Time

CollectionCollection Larry will receive 6 hrs extra pay, which is Larry will receive 6 hrs extra pay, which is

equivalent to 4 hours at 1 ½ times his equivalent to 4 hours at 1 ½ times his hourly ratehourly rate

Where is overtime paid?Where is overtime paid?

Comp Time:Comp Time: Comp time earned and taken is Comp time earned and taken is

typically tracked outside of HRMS, typically tracked outside of HRMS, possibly on the employee’s work possibly on the employee’s work record record

Dept work records are the official Dept work records are the official record for comp time balancesrecord for comp time balances

Comp time Comp time takentaken may be recorded may be recorded in HRMS:in HRMS: Use earnings code CMPUse earnings code CMP

How is it calculated?How is it calculated?

Hours worked for purposes of Hours worked for purposes of OT do not include:OT do not include: holidays, vacation, sick or admin holidays, vacation, sick or admin

leave (except for essential services leave (except for essential services positions), or comp time takenpositions), or comp time taken

How is it calculated?How is it calculated?

Work hours can not be Work hours can not be averaged across more than one averaged across more than one week. For example:week. For example: Work hours can not be averaged Work hours can not be averaged

at the end of the monthat the end of the month Hours worked in excess of the Hours worked in excess of the

regular schedule in one week regular schedule in one week cannot be used for time off in any cannot be used for time off in any other weekother week

How is it calculated?How is it calculated?

Overtime is calculated on a Overtime is calculated on a weekly basisweekly basis

Overtime does not accrue when Overtime does not accrue when an employee works beyond an employee works beyond his/her regular daily schedulehis/her regular daily schedule

Overtime Examples

Sunday Monday Tuesday Wed Thursday Friday Saturday

8 8 8 8 8

Sunday Monday Tuesday Wed Thursday Friday Saturday

8 8 8 8 8 4

Sunday Monday Tuesday Wed Thursday Friday Saturday

Holiday 8 8 8 8 4

40 hours worked. No overtime accrued for this work week.

44 hours worked. 4 hours at 1 ½ rate = 6 hours extra pay or comp time.

36 hours worked. No overtime accrued for this work week for non-essential services employees.

Week 1

Week 2

Week 3

Essential Services and OvertimeEssential Services and Overtime

Essential positions support services Essential positions support services directly responsible for health, directly responsible for health, safety, and welfare of patients, safety, and welfare of patients, residents, or studentsresidents, or students

Typically designated by Vice Typically designated by Vice ChancellorChancellor

Department should note on special Department should note on special requirements page of PDQrequirements page of PDQ

Per State Personnel Rules, paid Per State Personnel Rules, paid leave counts as work time when leave counts as work time when calculating overtime for essential calculating overtime for essential employeesemployees

Can Overtime be waived? NO!Can Overtime be waived? NO!

Once overtime has been worked Once overtime has been worked (whether approved or not), it must be (whether approved or not), it must be compensatedcompensated

Unauthorized overtime may be Unauthorized overtime may be cause for corrective actioncause for corrective action

Communication is keyCommunication is key Departments should have procedures in Departments should have procedures in

place for requesting overtime & approval place for requesting overtime & approval requirementsrequirements

Preferred method is to use comp time in Preferred method is to use comp time in lieu of cashlieu of cash

What records do I need?What records do I need?

Time/work records shall be kept for Time/work records shall be kept for both exempt and non-exempt both exempt and non-exempt employeesemployees

Both employee and supervisor must Both employee and supervisor must verify and sign work recordsverify and sign work records

Departments may select work Departments may select work records they wish to use (see PBS records they wish to use (see PBS website for suggested forms)website for suggested forms)

Records should be kept for minimum Records should be kept for minimum of 5 years (7 years or more for of 5 years (7 years or more for positions funded from grants)positions funded from grants)

Who does what? HR’s Role Who does what? HR’s Role

1)1) Designate overtime status for Designate overtime status for positionspositions

2)2) Advise departments on developing Advise departments on developing overtime/comp time policiesovertime/comp time policies

3)3) Assist with questions from Assist with questions from employers and employees employers and employees regarding overtime compensationregarding overtime compensation

Who does what? Who does what? Department’s ResponsibilitiesDepartment’s Responsibilities1)1) Know who is eligible for overtime Know who is eligible for overtime

2)2) Ensure employees know and understand Ensure employees know and understand OT policy and expectationsOT policy and expectations

3)3) Do not allow employees to work extra Do not allow employees to work extra hours without appropriate compensationhours without appropriate compensation

4)4) Ensure both supervisor and employee Ensure both supervisor and employee agree and sign work record each monthagree and sign work record each month

5)5) Ensure hours worked are documented and Ensure hours worked are documented and accounted for on a work record/time sheetaccounted for on a work record/time sheet

Will I ever remember all this? Will I ever remember all this? Additional ResourcesAdditional Resources Employment ServicesEmployment Services

303-492-6475 (main office)303-492-6475 (main office) http://hr.colorado.edu/es/Pages/http://hr.colorado.edu/es/Pages/

overtimeflsa.aspx overtimeflsa.aspx

PBS Procedures Guide:PBS Procedures Guide: https://www.cusys.edu/pbs/https://www.cusys.edu/pbs/

proceduresguide/proceduresguide/

Employee Work Record forms:Employee Work Record forms: http://www.cu.edu/pbs/forms/http://www.cu.edu/pbs/forms/

Record Retention Checklist:Record Retention Checklist: https://www.cu.edu/pbs/payadmin/https://www.cu.edu/pbs/payadmin/

policies/pay-records.htmlpolicies/pay-records.html