Overview: The Fair Labor Standards Act (FLSA) was enacted in 1938, during the depths of the Great Depression. Its goal was to lift the nation back into prosperity by spreading the workload among more workers, thereby alleviating unemployment, and by giving consumers more spending money, thereby spurring the economy.
To accomplish those goals, the law established two main requirements for employers:
Although the Great Depression has passed, the law continues to challenge employers. Few employers set out to deliberately violate FLSA regulations. Rather, most violations are the result of common mistakes, such as:
Employers also often get tripped up by variations between the FLSA regulations and state wage and hour laws. Sometimes the differences can be subtle; other times, they can be significant. But whatever the difference, employers must always comply with whichever law is more favorable to the employee.
Trends: The chances of getting away with noncompliance seem to get increasingly slim with every passing year.
Thousands of lawsuits are filed under the FLSA every year, more than any other federal employment law other than the Employee Retirement Income Security Act (ERISA). At the same time, the U.S. Department of Labor continues to enforce the FLSA regulations aggressively.
The potential liability for noncompliance can be costly, including back wages, attorney fees and civil penalties.
These damages are often multiplied by hundreds or even thousands of employees, since it is relatively easy for large groups of employees to file collective actions under the FLSA. This results in settlements or verdicts that can easily add up to millions of dollars for larger employers.
Author: Michael Cardman, Legal Editor
This chart summarizes state "show-up time" or "reporting time" laws requiring payment to employees who report for duty but are not provided work.
The International Franchise Association warned that the agreement "could serve as evidence of a joint employment relationship in future litigation or a government enforcement action."
Updated to reflect increased civil penalties for violations of the Fair Labor Standards Act, effective August 1, 2016.
In Schaefer v. Walker Bros. Enters., the 7th Circuit Court of Appeals followed federal guidance that allows employers to claim the minimum wage tip credit even when their employees spend as much as 20 percent of their time performing duties that are related to their occupations but do not explicitly produce tips.
This webinar discusses what the Supreme Court's term will mean for HR and in-house counsel with expert insights and analysis from Anthony Oncidi, who heads the labor and employment practice group in the Los Angeles office of Proskauer Rose, and XpertHR Legal Editor David Weisenfeld.
In Flores v. City of San Gabriel, the 9th Circuit Court of Appeals held that payments of cash in lieu of benefits must be included in the regular rate when calculating how much overtime employees are owed under the Fair Labor Standards Act (FLSA).
Updated to reflect the passage of San Diego's new minimum wage ordinance, effective July 11, 2016.
Updated to reflect a forthcoming law that will allow parents and legal guardians to issue work certificates for youths under 16 years of age.
HR guidance on complying with the Fair Labor Standards Act (FLSA). Support on following all the complex FLSA regulations and standards.