What Is The Fair Labor Standards Act (FLSA)?

While many individuals are aware of various labor laws and regulations, the specifics of these protections often remain unclear. Whether you are an employee seeking to understand your rights or an employer aiming to comply with legal standards, a thorough grasp of the Fair Labor Standards Act (FLSA) is essential for navigating the modern workforce landscape.

This article provides a comprehensive overview of the FLSA, detailing its critical components and implications for workers and employers alike. All information is sourced from the U.S. Department of Labor, presented in an accessible format.

Key Takeaways:

• The Fair Labor Standards Act of 1938 (FLSA) is a fundamental U.S. labor law that establishes essential rights for workers, including:

  • Federal minimum wage
  • Overtime pay
  • Regulations on child labor
  • Recordkeeping requirements

• The federal minimum wage remains at $7.25 per hour, although many states and localities have enacted higher minimum wages.

• For employees aged 16 and older, the FLSA does not limit the number of hours they can work, including overtime, though they must receive appropriate overtime pay.

What Is the FLSA?

The Fair Labor Standards Act (FLSA) is a pivotal U.S. labor law that establishes key rights for workers, including a federal minimum wage, overtime compensation, child labor regulations, and recordkeeping mandates applicable to both part-time and full-time employees across private sector and governmental roles.

• The FLSA is enforced by the Wage and Hour Division (WHD) of the U.S. Department of Labor (DOL) for most private sector and state/local government employees, including U.S. Postal Service and Library of Congress staff.

• For employees of other Executive Branch agencies, enforcement falls to the U.S. Office of Personnel Management, while Legislative Branch employees are overseen by the U.S. Congress.

• Unique regulations exist for state and local government employees, particularly regarding volunteer roles, fire protection, and law enforcement duties, which may involve compensatory time off instead of traditional overtime pay.

• The FLSA is a complex law with many facets; below, we provide a clear and concise breakdown of its coverage and implications.

Wages Under the FLSA

The FLSA mandates that employers pay wages on a regular schedule, adhering to expected paydays for specific pay periods.

1. Minimum Wage. Covered workers are entitled to a minimum wage of $7.25 per hour unless exempt. This federal minimum wage has been in effect since July 24, 2009, and applies to all states, with specific provisions for American Samoa and the Commonwealth of the Northern Mariana Islands. Employees are entitled to the higher of federal or state minimum wages when applicable.

2. Overtime Pay. Non-exempt workers must receive overtime pay at “time and a half,” calculated after 40 hours of work in a single workweek. The standard rate includes:

   • The base pay rate
   • Bonuses
   • Commissions
   • Piece rates
   • Incentives
   • Shift differentials
   • Training pay

   Note that overtime pay is not required for work performed on weekends, holidays, or regular days of rest unless overtime occurs on those days.

3. Deductions. Deductions from wages for reasons like cash shortages or required uniforms are permitted only if they do not reduce the employee’s wage below the minimum wage. Additionally, the value of board, lodging, and other facilities may be included in wages, provided it does not lower pay below the federal minimum.

4. Tips. Tipped employees, defined as those receiving $30 or more in tips monthly, have different wage standards. Employers must pay at least $2.13 per hour directly, and tips may count towards the minimum wage, but the total of direct wages and tips must meet or exceed the federal minimum wage. Employers must also ensure that employees retain all their tips.

5. Subminimum Wage. Specific provisions allow for subminimum wages for students and individuals with disabilities, which are aimed at increasing employment opportunities for those facing barriers to traditional employment.

While these standards provide a baseline for wages, exemptions apply based on the type of business or specific job roles.

What Is Not Covered by the FLSA?

The FLSA sets federal minimum wage and overtime requirements but does not regulate certain employment aspects, including:

• Meal breaks
• Vacation and holiday time off
• Severance and sick pay
• Premium pay for holiday or weekend work
• Pay raises and benefits
• Termination notices and reasons for termination, or immediate payment of final wages (under “at-will” employment)

While the FLSA mandates a minimum wage, it does not provide procedures for wage collection or payment beyond the established requirements. However, some states have their own laws governing these matters.

Employees aged 16 and older can work without restrictions on the number of hours, including overtime, provided they receive appropriate compensation.

All uncovered labor practices are subject to agreements between employers and employees or further regulations by state or local laws.

Who Is Covered by the FLSA?

Under the FLSA, all non-exempt enterprises engaging in interstate commerce or producing goods for interstate commerce must comply with the Act.

In simpler terms, any business operating across state lines is subject to FLSA requirements.

• A non-exempt enterprise is defined as an entity conducting business with an annual gross volume of sales of $500,000 or more, excluding retail taxes, or involved in various specific operations, including:

  • Hospitals and care institutions
  • Educational institutions
  • Public agencies

• This “500,000 test” was last revised on March 31, 1990, but organizations covered before this date remain subject to FLSA requirements.

• Employees of exempt enterprises may still be protected by the FLSA if engaged in interstate commerce or related tasks, including:

  • Using phones or mail for interstate communication
  • Working in transportation or communications
  • Keeping records of interstate transactions
  • Handling goods moving in interstate commerce
  • Traveling across state lines for work
  • Working for contractors engaged in interstate commerce

• Certain domestic service workers, like housekeepers or nannies, are also covered if:

  • They earn $1,700 or more in cash wages from a single employer
  • They work more than eight hours per week for one or more employers

In summary, most businesses with employees engaged in interstate commerce will be subject to the FLSA’s provisions.

Child Labor Laws

The FLSA includes provisions aimed at protecting children, ensuring their well-being and prioritizing educational opportunities over labor. These regulations limit hours and specify hazardous occupations for minors.

Key provisions for child labor in non-farm jobs include:

1. Non-Farm Jobs: Minors aged 14 and 15 can work in non-hazardous jobs outside school hours, with restrictions on the total hours worked:

   • No more than three hours on a school day, 18 hours in a school week, eight hours on non-school days, or 40 hours in non-school weeks.
   • Work hours may not begin before 7 a.m. or end after 7 p.m., except from June 1 through Labor Day, when work can be scheduled until 9 p.m.
   • Minors may participate in approved Work Experience and Career Exploration Programs (WECEP) for additional hours during school weeks.
   • Minors aged 16 and 17 may work unlimited hours in non-hazardous jobs.
   • Youths aged 18 and older can perform any job, including hazardous roles, for unlimited hours.

   For most non-farm work, 14 years is the minimum age for employment, with exceptions for specific roles like entertainment or delivery.

2. Farm Work: Regulations differ slightly, allowing minors under 12 to work in non-hazardous jobs on family farms. Provisions also apply to older minors:

   • Minors aged 12 and 13 can work in non-hazardous roles with parental consent.
   • Minors aged 14 and 15 can work any non-hazardous farm jobs outside school hours.
   • Minors aged 16 and older can work unlimited hours in any job, hazardous or not.

   Parents may employ their children in any job on their own farms. Certain youth minimum wage provisions permit employees under 20 to earn $4.25 per hour during the first 90 consecutive days of employment.

Recordkeeping Requirements

Employers are required by the FLSA to maintain records of wages, hours, and other specified items to ensure compliance. Most employers already track this information as part of standard business practices.

Records do not need to follow a specific format, but employers must utilize time clocks to track employee hours. Required records include:

• Employee personal information (name, address, occupation, sex, and birthdate if under 19)
• Workweek start date
• Total hours worked each day and week
• Total earnings for each pay period
• Regular hourly pay rate for overtime weeks
• Total overtime pay
• Deductions or additions to wages
• Date of payment and pay period covered

Exempt employees have different recordkeeping requirements, particularly those engaged in non-standard pay arrangements or receiving lodging.

Protections for Nursing Mothers

Recent amendments to the FLSA require employers to provide break time for nursing mothers. Mandated by the Patient Protection and Affordable Care Act (PPACA), this provision ensures that employees can express breast milk for up to one year after childbirth. The frequency and duration of breaks may vary based on the employee’s needs.

Employers must provide a private space, shielded from view, for milk expression that is not a bathroom. These provisions apply unless state laws offer greater protections.

In summary, understanding the Fair Labor Standards Act is crucial for both employers and employees in navigating today’s labor market. Awareness of these regulations can help foster fair labor practices and ensure compliance with established laws.

Author

Chris Kolmar

Chris Kolmar is a co-founder of Zippia and the editor-in-chief of the Zippia career advice blog. He has hired over 50 people in his career, been hired five times, and wants to help you land your next job. His research has been featured on the New York Times, Thrillist, VOX, The Atlantic, and a host of local news. More recently, he's been quoted on USA Today, BusinessInsider, and CNBC.