What Is The Fair Labor Standards Act?

What is The Fair Labor Standards Act
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The Fair Labor Standards Act (FLSA) is a law created in 1938, and it sets the federal minimum wage and overtime laws. That is where most people’s knowledge about this vital law ends. However, it also dictates the number of work hours, establishes child labor provisions, and limits specific jobs for women. Seeing how it covers a wide range of workers’ rights, we will specifically focus on its origins, how it affects workers and applies to employers, as well as how you can learn more about your rights and obligations under the FLSA.

What is the Fair Labor Standards Act?

FLSA is a federal law that sets the minimum wage for both full-time and part-time workers. It also establishes rules for overtime pay, child labor, recordkeeping, and more. The FLSA was enacted on June 25, 1938, by the United States Congress to protect employees from exploitation at work.

The FLSA applies to all employees covered by the legislation, including those who have less than $23,600 as their annual salary or anyone working on a farm with less than $500,000 in sales per year. 

The FLSA covers everyone, from full-time to part-time workers. These workers all belong to private sectors, as well as federal, state, and local governments. Therefore, this law may apply to you depending on what type of organization you work for.

Who is covered by the Fair Labor Standards Act?

People who work around domestic services also fall into the group protected by the FLSA. Aside from the domestic service workers, the law also covers people who work for preschools, schools, government agencies, hospitals, and certain medical or nursing businesses and facilities. Except for the exempt employees, all workers must be paid a national minimum wage established by the U.S. Congress. As stated previously, the federal minimum hourly rate is $7.25 per hour.

Even though some states have different minimum wage rates, the employer is obligated to pay whichever, federal or state wage, is higher. However, some employers pay their workers a minimum wage of $2.13 an hour if the worker receives at least $30 tips per month.

Workers need to be paid at least $684 per week to qualify for the minimum wage exemption. However, these salary requirements don’t include sales employees, teachers, and practicing law or medicine.

Regardless of how many hours or days an employee worked, the exempt employee needs to receive the full salary for their work over the week. However, If the employer makes a deduction from the employee’s set pay, that employee is not paid on a salary basis anymore. Along with that, the exempt employees don’t need to be paid for the workweek if they didn’t work during that period of time.

Employers might use non-discretionary bonuses, as well as incentive payments, in order to reach 10$ of the standard salary level. If the employer didn’t match their financial obligations during the 52 weeks, they could make one final payment within one pay period once the 52 weeks end. This way, the employer will reach the required level of payment for the employee. Any catch-up payment like those will count only for the prior year’s salary, not for the year in which it is paid.

Overtime, Minimum Wage, And Exemptions

As mentioned above, the FLSA regulates working conditions for jobs, aside from a few specific exemptions. The law tries to ensure that workers are paid a fair wage for their work.

The FLSA standards provide two types of exemptions, one of them being to exempt employees from both minimum wage and overtime requirements, while some other employees only have overtime requirements. Along with that, employers don’t need to pay employees the minimum wage if there is a statutory exemption. 

However, for nonexempt employees, FLSA standards set both the minimum wage rates and overtime requirements in stone. Even though the current federal minimum wage is $7.25 per hour, any employee under the age of 20 may be paid not less than $4.25 per hour during the first ninety days of employment. Both the working days and off-days are included in these first ninety days. Therefore, violating the law and refusing to pay workers their minimum wage can result in monetary penalties and even imprisonment.

Regarding overtime pay requirements, the FLSA doesn’t have a limit to the number of hours an employer might expect an employee to work, either in a day or a week. However, the employer must pay this overtime half the time of their regular rate unless the employee falls into the group of people who are exempt from the FLSA requirements for hours of overtime. This means that, as long as nonexempt employees work only the mandatory 40 hours a week, the employer won’t need to pay overtime even if the employee works more than eight hours in one day. This also applies to holidays and weekends. Therefore, to determine the appropriate amount of overtime owed, the employer needs to determine the employee’s regular rate and hours during the first week.

For example, If an employee works for 44 hours a week and earns the minimum wage of $7.25, the employer is obligated to pay them the additional 6 hours of work. However, employees who work during the weekends and holidays do not qualify for overtime pay. The FLSA only applies when the employee goes over the limit of 40 hours of work per week.

What does the FLSA require employers to do?

Something to keep in mind is that employers can be fined for violating the FLSA, which includes refusing to pay overtime or misclassifying workers. Therefore, to have proof of this happening, workers must accurately report hours on their timecards.

Regardless of the number of employees hired, companies are always required to comply with the FLSA standards. However, some workers are exempt in part or whole from the FLSA, as we mentioned above.

Recordkeeping

Employers are obliged to keep records and specific types of information about their employees and maintain it.

The FLSA sets standards for these types of information. They include the employee’s full name, social security number, address, sex, occupation, and if they are younger than nineteen. It also must have hours worked in one day, total hours worked during the week, and the amount paid by the employer per hour, week, or item produced. Along with that, the employer also needs to keep track of daily and weekly straight-time earnings, weekly overtime earnings, deductions from the employee’s wages, wages paid each pay period, the date of payment, and the pay period covered by that payment.

Child Labor Provisions

These provisions provide minimal exemptions. The FLSA authorizes and protects the rights of all those under the age of eighteen. These provisions set standards of how much work a child can do, what they are allowed to do, and establish a limited number of hours children can work.

These laws are also known as child labor laws and were established to make sure that young people work in an environment that is safe for both their mental health and physical health and possible educational opportunities. If you ask yourself how to find out more about your rights and responsibilities under the FLSA, look no further than Cilenti & Cooper. They will be able to aid you in finding all the answers you need regarding this vital law. Moreover, they will help you if you are not sure if your wage rate is fair compared to the work you are doing or if you feel like you are being discriminated against at your workplace. If you need more information on this, feel free to see which services they offer and schedule a free consultation at your earliest convenience!

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