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US Fair Labor Standard Act or FLSA for HR Professionals and Business Owners

By Kathy Nguyen
12

The Fair Labor Standard Act or FLSA is an important legislation that both HR professionals and business owners need to know in the US market. The Fair Labor Standards Act (FLSA) establishes the federal minimum wage ($7.25 per hour), overtime pay (time and a half of regular hourly wage), recordkeeping, and child labor standards affecting full-time and part-time workers in the private sector and in federal, state, and local governments.

Keep in mind that the FLSA has exceptions.

For example, the FLSA does not require:

(1) vacation, holiday, severance, or sick pay

(2) meal or rest periods, holidays off, or vacations

(3) premium pay for weekend or holiday work

(4) pay raises or fringe benefits

(5) a discharge notice, the reason for discharge, or immediate payment of final wages to terminated employees.

Tipped employees
Tipped employees are individuals engaged in occupations in which they customarily and regularly receive more than $30 a month in tips. Employers may consider tips as part of wages, but employers must still pay at least $2.13 an hour in direct wages.

Who is Covered?

A covered enterprise is the related activities performed through unified operation or common control by any person or persons for a common business purpose and:

(1) whose annual gross volume of sales made or business done is not less than $500,000 (exclusive of excise taxes at the retail level that is separately stated)

or (2) is engaged in the operation of a hospital, an institution primarily engaged in the care of the sick, the aged, or the mentally ill who reside on the premises; a school for mentally or physically disabled or gifted children; a preschool, an elementary or secondary school, or an institution of higher education (whether operated for profit or not for profit)

or (3) is an activity of a public agency.

Recordkeeping
The FLSA requires employers to keep records on wages, hours, and other items, as specified in DOL recordkeeping regulations.

These are basic references for HR professionals and business owners to familiarize yourself with the federal FLSA. More info of FLSA is listed in my fast-tracked study guide on this website which also contains many important references of employment law and legislation at the federal level that you should know.

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