How the FLSA Impacts Your Business

As an employer, you try to maintain compliance with the law –and work to ensure that you provide good working conditions for your employees.

But what you may not know is that many employment guidelines that you follow come from a federal law known as the Fair Labor Standards Act (FLSA).

The FLSA has a long history. Dating back to 1938, this act was passed following the Great Depression –a time where many companies took advantage of their workforce –imposing difficult working conditions on their workers, and subjecting them to inhumane hours. Over the years, the FLSA has undergone many changes –and has been amended a number of times.

Some of the changes that the law has undergone over time include amendments that require male and female workers to receive equal pay, as well as the creation of standards for determining compensatory or comp time, and setting requirements for how employers are to pay workers for overtime work.

At its core, the FLSA aims to protect workers and their rights. Today, it includes minimum wage requirements, regulations surrounding overtime pay, recordkeeping, and youth employment standards. The act applies to almost all U.S. employers in both the private sector, as well as the government –at the federal, state, and local levels.

While you almost certainly are familiar with many of the regulations covered in the FLSA, you may not know that the laws themselves come from this act. To help you brush up on your knowledge of workplace regulations, here’s a look at some of the areas that the FLSA covers –as well as a brief summary of how they affect you.

What Does the FLSA Cover?

The FLSA covers a number of areas including:

• Minimum Wage:

The federal minimum wage is $7.25 per hour. In states that have minimum wage laws, the employer must comply with both, and pay the higher minimum wage.

• Overtime:

Nonexempt employees that meet the guidelines for overtime pay; must receive one and one-half times the regular rate of pay for hours that are worked over a 40 per workweek. There is no limit on the number of hours that employees 16 years or older may work, and the FLSA does not require overtime pay for work on weekends, holidays, or regular days of rest –except in the case of overtime. These regulations apply on a workweek basis; which is a fixed and regularly recurring period of 168 hours, or, seven consecutive 24-hour periods. A workweek can begin on any day of the week, and any hour of the day.

• Hours Worked:

Hours worked is defined as all of the time that an employee is required to be on the employer’s premises, on duty, or at a prescribed workplace.

• Recordkeeping:

Employers are responsible for keeping track of employee time and pay records. While the Act doesn’t specify a particular form for the records, it does require that they include certain identifying information about the employee and data about the hours worked and the wages earned. Basic records that employers must maintain include: the employee’s full name and social security number, the time and day of week when employee’s workweek begins, the hours worked each day, their total overtime earnings for the workweek, all additions to or deductions from the employee’s wages, and more. The law also states that employers are required to display an official poster that outlines the requirements of the FLSA.

• Child Labor:

These provisions, also known as child labor laws, are designed to ensure that when young people work, the work is safe. The law was designed to protect the educational opportunities for children; as well as to prevent them from working in conditions that are detrimental to their health. These provisions also provide limited exemptions.

While it’s easy to regard the FLSA as some obscure regulations –for employers, ensuring compliance with these laws is vitally important. Taking the time to keep up-to-date on current policy can help to keep you on the right side of the law; and will allow you to be certain that you’re compensating your workers fairly.