The Fair Labor Standards Act (FLSA) was passed in 1938, setting the standards for minimum wage, overtime pay, recordkeeping and child labor. The FLSA affects most private and public employers and has undergone revisions since the original.

1. The Fair Labor Standards
Act (FLSA) was passed in
1938, setting the
standards for minimum
wage, overtime pay,
recordkeeping and child
labor. The FLSA affects
most private and public
employers and has
undergone revisions
since the original.
Employers subject to the FLSA can be investigated by the DOL’s Wage and Hour Division
(WHD). Lost wages, liquidated damages and other fines and penalties are often the result if
employers are found in violation of the Act. Here are some of the common violations
investigators have found:
Miscalculation of overtime pay
Nonexempt employees must be paid 1.5 times their hourly rate
for time worked past their 40 hours worked during the workweek.
Misclassification of Employees
Companies must correctly classify exempt/nonexempt status as well as properly
classify workers as either employees or independent contractors.
Failure to pay for missed lunch/breaks
If an employee skips their lunch or break to work, the employer must
pay for that time.
Deductions from pay for poor
performance from an exempt employee
For example, if an exempt employee is habitually late, you cannot
deduct the time for their wages.
Failure to pay for work done
electronically off-hours
If a nonexempt employee is performing work-related functions outside the
office, even voluntarily, via use of their cell phone or computer, they must be
compensated for their time spent performing those duties.
Failure to keep accurate records
Employers must keep accurate timekeeping records for time worked by
employees. If the employer does not and an employee raises a dispute, the
courts tend to favor the employee’s record over the company
with little or no record.
Unauthorized deductions from earnings
Employers are not allowed to deduct from an employee paycheck anything
other than amounts required by law or authorized by the employee.
Failure to pay minimum wage
Currently, the federal minimum wage is $7.25 per hour and tipped employees
are paid a wage of $2.13 per hour. The minimum wage will increase to $10.10
per hour next year for government contractors. If tips do not cover the
difference between the employee’s wage and the minimum wage standard,
the employer must make up the difference.
Federal laws are not the only laws employers need to obey. State law will vary
and employers must follow them for every state where they have employees.
Failure to follow state laws
Failure to pay for time in
off-hour meetings
If a meeting is required and extends past the normal work hours, the
employer must pay the employee for that time.
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