ABCs of Employment Law: Fair Labor Standards Act
The Fair Labor Standards Act (FLSA) is a fundamental piece of legislation designed to protect the rights of employees in the areas of fair wages, reasonable working hours, overtime compensation, and child labor regulations. Staying informed about the protections this law offers you as an employee, including ongoing developments and updates to the law, will help you understand if your rights are being violated in the workplace.
What is the FLSA?
The Fair Labor Standards Act, enacted in 1938, serves to establish and regulate labor standards in the United States. Its primary focus is to ensure fair compensation for employees, create a standard workweek, and define the rules for overtime pay.
Employee Rights Protected by the FLSA
FLSA protected employee rights include the following:
- Minimum Wage: The FLSA sets the federal minimum wage that employees must be paid at $7.25 per hour, effective 2009. The minimum wage standard is also determined at the state level, with employees entitled to the higher pay between the two.
- Overtime Pay: Employees covered by the FLSA are entitled to receive overtime pay, calculated at one and a half times their regular rate, for hours worked beyond the standard 40-hour workweek. The FLSA does not regulate overtime pay for weekends, holidays, or days of rest, unless the work done in those periods already exceeds 40 hours per week.
- Child Labor Protections: The FLSA places restrictions on the types of work that minors can engage in and establishes minimum age requirements for certain occupations. This protects minors from conditions that could threaten their health, well-being, or educational opportunities.
- Recordkeeping Requirements: Employers must maintain accurate records of employees’ wages, hours worked, and other essential employment details to certify compliance with the FLSA. Employers must also display an official poster in their workplace that outlines the requirements of the FLSA.
Who Does the FLSA Apply To?
The FLSA applies to most employees in the United States, regardless of whether they work in the private or public sector. However, certain exemptions exist, such as executive, administrative, professional, and outside sales employees, as well as certain computer employees. It is important to note that the FLSA generally applies to employees, not independent contractors. Independent contractors are typically classified as being self-employed and are responsible for managing their own wages and working conditions.
Proposed Changes: Notice of Proposed Rulemaking
On October 13, 2022, the Department of Labor initiated a Notice of Proposed Rulemaking (NPRM) that could bring significant changes to the classification of employees and independent contractors. The proposed rule aims to establish a clearer and more concise standard for determining whether a worker is an employee or independent contractor. The NPRM suggests adopting an “economic reality” test to consider various factors such as the nature and degree of control over work, the opportunity for profit or loss, and the amount of skill required for the job. This potential change reflects a broader effort to modernize and streamline the classification process, providing clarity for both employers and workers.
Need any further clarification on the FLSA, or any other area of employment law? Contact Walcheske & Luzi for legal assistance today.