Fair Labor Standards Act

1
Fair Labor Standards Act

• What Supervisors Need to Know

2
Session Objectives

• You will be able to
• Comply with the basic requirements of FLSA
• Determine whether an employee is exempt or
  nonexempt
• Apply FLSA requirements to part-time workers and
  independent contractors
• Identify and observe child labor restrictions

3
FLSA Basics

• Minimum wage and overtime requirements
• Hours of work and how to calculate overtime
• Recordkeeping requirements
• Exemptions from overtime requirements
• Child labor laws

4
Why You Need to Know

• Wage and hour issues are critical to the
  operation of the organization
• FLSA determinations may be difficult
• The law affects employee compensation
• You play an important role in compliance

5
Nonexempt and Exempt

• Nonexempt employees
• Exempt employees

6
Minimum Wage

• Application
• Federal versus state requirements
• Minimum wage/overtime posters

7
Equal Pay

• Equal Pay Act
• Comparison of jobs
• Prohibited pay differentials
• Permitted pay differentials

8
Hours of Work

• FLSA requires regular and overtime pay
• Hours worked
• Workweek
• Preparatory and concluding activities

9
Hours of Work (cont.)

• Waiting time
• On-call time
• Travel time

10
Hours of Work (cont.)

• Split shifts
• Training programs, lectures, and meetings
• Holidays, vacations, and sick days
• Medical attention
• Report-in pay

11
Overtime

• Overtime for hours worked over 40
• Averaging hours prohibited
• Holiday/sick pay not included
• On-call and travel time may be included
• Employee rights
• Time of payment

12
Calculating Overtime

• Fixed 40-hour workweek
• Fixed workweek of fewer than 40 hours

13
Overtime Other Issues

• Distribution of overtime
• Required overtime
• Unauthorized overtime

14
Rest Periods

• Meals
• Work breaks
• Sleep time

15
Recording Work Time

• Means of tracking hours
• Regular starting and stopping times
• Discrepancies
• Rounding off

16
FLSA Recordkeeping

• Employee information
• Basic employment and earnings records
• Records on employees receiving tips
• Minimum requirements

17
FLSA Requirements

• Questions?

18
FLSA Exemptions

• Who is exempt?
• How do you determine exemptions?

19
Executive Exemption

• Salary of at least 455 per week
• Job duties
• Direct work of others
• Authority to hire and fire

20
Executive Definitions

• Primary duty
• Management
• Department or subdivision

21
Executive Definitions (cont.)

• Customarily and regularly
• Two or more
• Particular weight

22
Administrative Exemption

• Salary of at least 455 per week
• Job duties
• Exercise of discretion and independent judgment

23
Administrative Definitions

• Primary duty
• Related to management or general business
  operations
• Advising customers

24
Administrative Definitions (cont.)

• Discretion and independent judgment
• Matters of significance

25
Professional Exemption

• Learned and creative professionals
• Salary of at least 455 per week
• Primary duty
• Advanced knowledge in science or learning
• Acquisition of advanced knowledge

26
Professional Definitions

• Primary duty
• Work requiring advanced knowledge
• Field of science or learning
• Acquired through specialized training
• Invention, imagination, originality, or talent

27
Computer Exemption

• Salary or hourly rate
• Position

28
Computer Exemption (cont.)

• Primary duty
• Employees not included

29
Combination Exemptions

• Definition
• Examples

30
Other Exemptions

• Highly compensated employees
• Outside sales people

31
Other Exemptions (cont.)

• Business owners
• Motor carriers
• Commissioned retail sales

32
Deductions from Pay

• Absences due to illness or disability
• Absences for personal reasons
• Offsets
• Disciplinary suspensions and penalties
• First and last weeks of employment
• Unpaid leave

33
Part-Timers and FLSA

• Minimum wage
• Overtime
• Equal pay

34
Contractors and FLSA

• Contractors include workers who contract with the
  company
• Reasonable basis test

35
Contractors and FLSA (cont.)

• Common-law test

36
Exemptions

• Questions?

37
Child Labor Laws

• Purpose of child labor laws
• Workers under age 18
• Minimum wage
• Overtime

38
Work Restrictions

• Work restrictions for all minors under 18
• Other restrictions vary depending on minors age

39
Hours of Work

• Restrictions for minors who are 14 or 15
• No restrictions for minors who are 16 or 17

40
Additional Considerations

• Proof of age
• Government contracts
• Penalties for violation of laws

41
Key Points to Remember

• FLSA is a federal law that applies to most
  organizations
• This law governs minimum wage, overtime, and
  child labor issues
• Most employees are covered
• Be aware of the impact of this law