Employment and Labor Laws

Federal

Fair Labor Standards Act (FLSA)

The Fair Labor Standards Act (FLSA) is a federal law that sets minimum wage, overtime, and minimum age requirements for private and public employers and employees. 29 USC 201 et al  The FLSA also applies to full-time, part-time, probationary, and temporary employees and establishes child labor standards. The labor standards do not apply to bona fide independent contractors.

The FLSA creates two classifications of employees for purpose of minimum wage and overtime purposes. The two classifications are exempt employees and non-exempt employees. FLSA minimum wage and overtime requirements apply differently to employees depending on how they are classified. Additionally, the FLSA has record keeping requirements related to employers’ compliance with minimum, overtime, and child labor requirements.

It is also important to note that the FLSA standards may not be the only legal standards that apply to employers and employees regarding minimum wage, overtime, and child labor. Many states and local governments have enacted their own labor standards laws, some of which have higher minimum wage rates, more stringent overtime rules, and different child labor requirements with which employers must also comply. 29 CFR 541.4


Current Minimum Wage

The current federal minimum wage is $7.25.

The current federal minimum wage for tipped employees is $2.13.


Minimum Employees Required

There is no minimum number of employees that must work for an employer before the employer is responsible to comply with Fair Labor Standards Act standards. However, there are some employees who are exempt in whole or in part from FLSA requirements. Those exemptions are discussed immediately below.


Exempt Employees

Employers do not need to pay employees the mandated minimum wage rate and/or overtime if bona fide statutory exemptions apply to the employees. The Fair Labor Standards Act (FLSA) provides for two categories of exemptions: (1) those that exempt employees from both minimum wage and overtime requirements and (2) those that exempt employees from only the overtime requirements. For a discussion of those requirement, visit:

Currently, the misclassification by employers of employees as exempt is one of the most active areas of enforcement for the United State Department of Labor (DOL). Employers that improperly classify employees as exempt are generally required to reimburse the improperly classified employees for the income lost due to the improper classification. Employers may also be subject criminal prosecution in the courts and fines and penalties up to $10,000 or $1,000 per violation depending on the willfulness of the violation.


Non-exempt Employees

For non-exempt employees, the Fair Labor Standards Act sets minimum wage rates and overtime requirements. Currently, the standard federal minimum wage is $7.25 per hour. (To see state minimum wage rates click here). Employees under the age of 20 may be paid not less than $4.25 per hour for the first ninety (90) consecutive calendar days of employment. The ninety (90) consecutive calendar days include both days worked and days not worked. The minimum applies to full-time and part-time workers, temporary workers, and many interns and volunteers.

Failure to comply with minimum wage laws can result in monetary penalties and imprisonment depending on the gravity and willfulness of the violation.


Overtime

Under the FLSA, there are no limits to the number of hours an employer may require an employee to work in one workday or one workweek. However, employers are required to pay employees an overtime rate of one and a half times their regular rate of pay for all hours worked in a workweek in excess of 40, unless the employee is otherwise exempt from the FLSA’s overtime requirements. 29 CFR 778.107. Conversely, as long as a non-exempt employee does not work more than 40 hours in a workweek, an employer is not required to pay overtime of one-half times even if the employee works more than eight hours in one day or whether the employee works on a holiday, a Saturday, or a Sunday.

Thus, in order for an employer to calculate the appropriate amount of overtime owed to employees, it must first determine the employee’s regular rate and hours worked by the employee in the applicable work periods

Employers may enter into contracts with employees that provide a greater obligation for overtime compensation than the FLSA requires. If other Federal or State laws impose greater obligations for overtime pay than the FLSA, those greater obligation may apply. 29 CFR 778.102. Find out more about State Overtime Laws.

Also, private sector employer are prohibited by from avoiding paying overtime by awarding exempt employees who work on an hourly basis with compensatory time. The Fair Labor Standards Act does permit public agencies and employers to award employees with compensatory time in lieu of overtime. Compensatory time refers to an employer allowing an employee to work fewer hours in one workweek to reduce the employees the number of hours the employee worked in a different workweek. Thus, if an employee for a private sector employer works overtime one week, the employer cannot avoid paying such employee overtime for that applicable workweek by having the employee work fewer hours the next week.


Child Labor Laws

The Fair Labor Standards Act governs the employment of minors (children under 18 years of age). For more information, visit our Fair Labor Standard Act’s Child Labor Laws page.


Tipped Wages

The FLSA permits employers to pay certain employees tipped wages. The current federal tipped wage rate is $2.13. The standards for paying employees tipped wages under the FLSA are discussed on our Tipped Wages page.


Hours Worked

For information regarding when an employer must count an employees time as hours worked for purposes of minimum wage and overtime calculations, visit our Fair Labor Standards Act – Hours Worked page.


Travel Time

For information regarding counting travel time as hours worked for purposes of minimum wage and overtime calculations, visit our Fair Labor Standards Act – Hours Worked: Travel Time page.


Waiting Time

For information regarding counting waiting time as hours worked for purposes of minimum wage and overtime calculations, visit our Fair Labor Standards Act – Hours Worked: Waiting Time page.


On-Call Time

For information regarding counting on-call time as hours worked for purposes of minimum wage and overtime calculations, visit our Fair Labor Standards Act – Hours Worked: On-Call Time page.


Sleeping Time

For information regarding counting sleeping time as hours worked for purposes of minimum wage and overtime calculations, visit our Fair Labor Standards Act – Hours Worked: Sleeping Time page.


Meeting and Training Time

For information regarding counting meeting or training time as hours worked for purposes of minimum wage and overtime calculations, visit our Fair Labor Standards Act – Hours Worked: Meeting and Training Time page.


Show-Up Time

For information regarding counting show-up time as hours worked for purposes of minimum wage and overtime calculations, visit our Fair Labor Standards Act – Hours Worked: Show Up Time page.


Suffered or Permitted to Work

For information regarding counting time suffered or permitted to work as hours worked for purposes of minimum wage and overtime calculations, visit our Fair Labor Standards Act – Hours Worked: Suffered or Permitted to Work page.


State Minimum Wage and Overtime Laws

To see your state’s wage and hour, hours worked, exemptions, minimum wage and overtime laws you can start by visiting our state law pages.


Resources:


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