Legal Guide

How does the Fair Labor Standards Act protect American workers?

To improve working conditions in America, the Fair Labor Standards Act (FLSA), was established 80 years ago. As workers and businesses adapt to the 21st-century workplace, the law has changed over time.

In an interview with SHRM Online, Steven Pockrass from Ogletree Deakins, an Indianapolis attorney, stated that the Fair Labor Standards Act, which was passed in 1938, has had a significant impact on the workplace. It requires employees to be paid at minimum a minimum wage for every hour worked, and overtime premium pay for any hours over 40.

Initial FLSA regulations established a minimum hourly wage of $25 (currently $7.25) and a workweek of 44 hours (later reduced to 40). With some exceptions for family and agricultural businesses, the act prohibited employers from hiring workers under 14 years old. It also limited the types of jobs that children could do.

Compliance issues today

If you run into any issues involving your wages, make sure to find experienced unpaid wages lawyers. Although lawsuits and regulatory actions regarding the FLSA are quite common these days, this has not always been the case. Pockrass stated that the FLSA, despite its long history has not been a hotbed of lawsuits. "Today however, however, the plaintiffs’ employment bar actively pursues FLSA collective actions, which are now a major source for potential exposure for employers."

According to LaToi Mayo, an attorney at Littler in Lexington Ky., HR departments should embrace technology in order to improve wage and hour compliance. Compliance tools are useful in determining employee classifications and performing payroll audits.

Mayo suggested that employers pay special attention to:

  • They track employee hours. Employers can use cloud-based tracking to accurately track hours and ensure compliance, especially for remote workers.
  • They have policies and practices regarding overtime hours that are not authorized. Employers can create a policy that requires overtime workers to obtain supervisory approval, but they still must pay them for illegal work. Employers can still discipline employees who work unauthorized hours. This is why they need a policy.
  • Management of meal and rest breaks. FLSA does not require meals or rest periods. However, breaks of 20 minutes or more must be paid. Employers should be aware that certain states have stricter laws and may require them to provide breaks.
  • Federal law is less friendly to employees than state laws. Many states have their own minimum wage, overtime rules, exemption standards and other wage laws.

Tomorrow's FLSA

It is hard to predict the future activities of Congress. Therefore, it is more difficult to predict which new laws Congress will pass to modify the FLSA.

He hopes to see an "independent contractor/employee" hybrid status to allow for the growing gig economy. An amendment to the FLSA is being considered to allow for an "intermediary" employee or "independent employee".

However, hybrid contractor/employee status is not something that worker advocates are open to. Christine Owens, a symposium organizer, stated that technology will continue to transform the way work is done. However, the reality is most people are still in traditional work arrangements. She is the Executive Director of the National Employment Law Project in Washington, D.C. NELP concerns about creating an intermediary standard between employee or independent contractor. Employers may misclassify workers as employees, and should be protected by the associated employment protections, she stated.

NELP supports sector-based standards for those industries that have many independent contractors, or are susceptible to misclassifications, like the ride-sharing industry. Owens stated that while we need to try new approaches, the main goal should be to ensure that every worker in this country has a decent standard of living and safe working conditions.

A possible change is an increase in the FLSA salary threshold to white-collar exclusions. The Department of Labor proposed final regulations in 2016 that would have raised the minimum hourly wage to $913.

The Society for Human Resource Management supports an update to the salary level, but one that follows prior methodology to achieve a fairer increase. SHRM stated that the 2016 salary increase of more than 100 percent was excessive and too fast. This would have been particularly problematic for employers with lower salaries, such as nonprofits, small employers and those in areas of lower living costs.

Pockrass stated that there seems to be a consensus that a lower minimum salary is necessary. However, we do not know when or how final regulations will be issued or how they will fair in court.

Americans today take minimum wages and overtime rates for children as a given. The FLSA and other laws have protected American workers from the risks of unregulated capitalism. There is widespread support for the effectiveness of laws like the FLSA, as evidenced by the current national push to raise the minimum wage. Happy birthday FLSA! Here's to strengthening it even more.

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