Fair Labor Standards Act (FLSA)
The Fair Labor Standards Act (FLSA) is a federal law in the United States that passed in 1938. Since then, FLSA has been altered several times. However, the main goal of the law has remained unchanged. The FLSA was created to protect working people from unfair work standards or pay.
During the Industrial Revolution and the Great Depression, workers of all ages were commonly abused and exploited. The FLSA provided protection to vulnerable workers and created child labor laws. Today, the law still works to ensure employees are paid a living wage and reimbursed fairly for overtime work.
Under FLSA regulations, workers are either "exempt" or "non-exempt."
Exempt employees are exempt from the law, which means they are not legally entitled to payment for overtime work, even if they work more than 40 hours per week. Exempt employees are typically salaried workers.
Non-exempt employees are entitled to overtime pay if they work more than 40 hours per week. Overtime pay is time and a half for every hour over 40. Employees who make less than $23,660 annually or $455 per week are non-exempt employees under FLSA.
Specific criteria must be met for an employee to be qualified as exempt.
Earn minimally $455 per week or $23,660 per year.
Be a salaried employee, which means that the employee's pay rate doesn't change regardless of the number of hours worked or work output.
Perform job duties that qualify as exempt under FLSA Regulations.
The FLSA regulates several employee practices, specifically where it concerns employee health, wages, and safety. These categories are covered by the FLSA:
Minimum wage: The FLSA dictates the federal minimum wage. Some states have their own minimum wage, and if a state's minimum wage is higher than the federal minimum wage, the employee is entitled to the minimum wage specified by the state.
Hours worked: Hours worked are defined as the time when an employee is required to be on duty, on the employer's premises, or at a prescribed workplace. Hours worked include time on call, training time, travel time, and sleeping time if the employee is required to be there during those hours.
Overtime pay: Under FLSA guidelines, non-exempt employees are paid one and a half times their standard pay rate for every hour worked over 40 hours per week. This is commonly called “time and a half.”
Recordkeeping: Employers are required to display an official FLSA poster with FLSA requirements in a place accessible to all employees. Additionally, employers are required to keep track of employee timesheets and payment records.
Child labor: The FLSA protects children from performing work that is detrimental to their safety or health. Additionally, FLSA laws are designed to allow children to pursue educational opportunities.
The FLSA applies to nonprofit organizations with annual revenue or sales of at least $500,000. While the law doesn't apply to activities such as collecting donations, it does apply to sales of products or services. Many religious workers and churches are exempt from the FLSA, but if the religious organization operates a nursing home or school, FLSA guidelines apply.
Suppose a night auditor at a hotel works a full eight hours without a break, from 12 midnight until 8:00 a.m. Because the employee is the only person working the desk during this time, the employee can't clock out. The job requires that they eat lunch at their desk while working. They can't leave the hotel and must remain on the property at all times. If the employer tries to force the employee to clock out to eat while remaining at the job site, this is a violation of FLSA.