Since the COVID-19 pandemic began, many businesses in the service industry are having difficulty finding essential workers or enticing former employees to come back to work. One of the arguments that many workers and unions are making is the fact that people consider them essential, however, they are not earning a living wage. There has been much discussion in Congress to amend the Fair Labor Standards Act (FLSA) to include a living wage that would adjust for inflation. In this article, we will discuss the FLSA and important aspects that any business owner should be aware of.

What Is The Fair Labor Standards Act?

The Fair Labor Standards Act or FLSA is a federal law passed by Congress that applies to both public and private employers in the United States. This law covers issues relating to a Federal Minimum Wage, Overtime, Regular Working Hours, and Recordkeeping. The law also sets out which agencies and governments are responsible for enforcing the law and the levels of punishment that can be assessed to those businesses violating the law.

What Businesses Does The FLSA Apply To?

The FLSA applies to essentially any business in the United States. To be exempt from the FLSA, the business must not be engaging in any interstate commerce and generating income less than half a million a year. Since most businesses engage in interstate commerce, most will have to follow the FLSA.

State And Local Laws Can Enhance FLSA

It is important to note that state and local governments may create laws that strengthen the FLSA as long as it does not contradict it. For example, as of this writing, the current minimum wage guaranteed under the FLSA is $7.25 an hour. The minimum wage in the State of Florida is currently $8.65. Since the Florida standard adds or enhances the FLSA minimum wage, businesses in Florida must meet the state-level standard.

On the other hand, if the state has failed to increase its minimum wage since the ’90s and it has remained at $4.25 an hour, then this would contradict the FLSA standard, and the employer of that state would have to meet the FLSA minimum standard.

FLSA does allow for employees who rely on tips to make less hourly. Currently, the FLSA allows for employees who make at least $30 a month in tips to have an hourly pay of $2.13 per hour.

Informing Employees Of Their Rights Under The FLSA

The FLSA requires employers to display posters in a conspicuous location where the employees can easily access them. These posters must inform the employee of their rights to a minimum wage, overtime pay, and other useful information such as those rights guaranteed by the Family Medical Leave Act.

What Records Do Employers Need To Keep?

The most common reason employers get in trouble under the FLSA is due to inaccurate or bad record keeping. Businesses must keep these records on file for at least three years. The following are the minimum records needed to be kept under the FLSA:

  • Legal name, home address, job title, gender, and age of each employee
  • Weekly work schedule and total hours worked each week
  • Daily or weekly straight-time earnings
  • Hourly rate of overtime work and the total of overtime pay
  • Any wage deductions or bonuses
  • The total paid out for each pay period and the period of what the pay period covers.

Need Help With FLSA Compliance

If you are a new business owner, an existing business owner, and you want to review your business procedures to ensure you comply with the FLSA or your current business might be in violation under the FLSA, contact Dowd Law. The attorneys at Dowd Law have years of experience in ensuring their clients are in compliance with the FLSA and are available to consult your to ensure your business is as well.