Atlanta Wage Hour & FLSA Claims Lawyers
Wage Issues Under The Fair Labor Standards Act
Both state and federal law may affect the compensation of a person who does work for an employer. These laws tell an employer when it must pay, how it must pay and the minimum amount it must pay for a job performed. The same laws may exclude or “exempt” certain employees from some or all of the requirements.
The federal law with the broadest coverage of these issues is the Fair Labor Standards Act. The Fair Labor Standards Act (“FLSA”) establishes minimum wage, overtime and record keeping standards requirements for employees in the private sector, federal and local government. Effective July 24, 2008 the minimum wage is set at $7.25 per hour. All “non-exempt” workers under the act are entitled to a minimum wage of at least $7.25 an hour plus overtime in an amount equal to one and one half time the hourly wage for all hours worked in a week in excess of 40 hours. “Exempt” employees must fit into specific classifications under the act in order for an employer to avoid the FLSA’s overtime requirements.
Another federal law that will significantly impact the type of time which must be compensated is the Portal-to-Portal Act. The Portal-to-Portal Act addresses pay for time spent going to the workplace, leaving the workplace or returning to the workplace as well as time spent getting ready to work. Applying the proper classification to all employees in all situations can result in thousands of dollars, even millions of dollars in savings or liabilities.
Importantly, the classification of an employee as exempt or non-exempt from the overtime requirements of the Fair Labor Standards Act is a matter of application and analysis under the tests outlined in the Act. All too often, employers apply an exemption to seemingly high paid employees that, under the act, is inappropriate. When a class of employees are improperly classified, the employer may be required to pay backwages for up to three years to the misclassified employees in amounts equal to overtime for all hours works in each work week plus liquidated damages in an equal amount and even attorney fees. Application of the exemption requirements is a critical function when setting up a business, applying pay grades or establishing positions and pay levels. And it is critical that this analysis is performed by someone with extensive experience under the FLSA.
In a nutshell, executive, administrative and professional employees, who function with discretionary authority and are highly compensated are exempt from the overtime and minimum wage requirements of the Fair Labor Standards Act. Outside sales persons and employees in certain computer related occupations are also exempt. But these designations are often confusing and misleading. As a result of a substantial overhaul of the exemptions under the FLSA in the last five years, application of the exemption tests requires expertise.
The FLSA does not require vacation, holiday, severance, or sick pay. It does not require meal or rest periods, holidays off or vacations. The Fair Labor Standards Act does not require premium pay for weekend or holiday work or pay raises or fringe benefits. Nor does the FLSA require a discharge notice, reason for discharge, or immediate payment of final wages to terminated employees.
The lawyers at Fried & Bonder know the Fair Labor Standards Act. They have successfully defended overtime class (collective) actions based upon improper classifications against employers throughout the country. They have counseled businesses when facing Department of Labor investigations. They have worked with businesses setting up the classifications and reviewing pay practices. And they have successfully pursued wages on behalf of workers. If you are an individual or business who has questions or needs help concerning wages, overtime pay or employee classifications, contact an attorney at Fried & Bonder.