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FLSA Guidelines
Introduction
The Fair Labor Standards Act of 1938 is a federal law initially adopted to create new jobs and put more people to work. The FLSA, which prescribes standards for the basic minimum wage and overtime pay, affects the Health Science Center and its employees. It requires the HSC to pay covered employees (“non-exempt” employees) at least the minimum wage and a premium pay for overtime worked. It also restricts the hours that minor children can work. The Act is administered by the Employment Standards Administration’s Wage and Hour Division with the U.S. Department of Labor.
Minimum Wage
The Act establishes a minimum hourly wage for employees. ($5.85 effective July 24, 2007; $6.55 effective July 24, 2008; $7.25 effective July 24, 2009) The law also establishes overtime pay requirements. Non-exempt employees may not be required to work more than forty hours in one workweek without overtime compensation paid. (see the Overtime and Compensatory Time section below) Exemptions from the overtime compensation provision are provided for workers who are employed in bona fide executive, administrative or professional capacities. Faculty and lecturers are covered under the category of “bona fide professionals”.
Exemptions
Under the FLSA regulations (29 CFR Part 541) some employees are “exempt” from coverage under the law. To be considered an exempt executive, professional, or administrative employee three tests must be satisfied:
- Salary Basis Test
- Salary Level Test
- Job Duties Test
Under the Salary Basis Test, a predetermined amount must be paid for every week in which the employee performs any work, which is not subject to reduction because of variations in the quality or quantity of work performed.
The Salary Level Test exempts employees making at least $445 per week (based on a calculation of 40 hours). Also exempt are employees with “total compensation” of at least $100,000 per year provided they:
- Make at least $23,660 per year on a salary basis,
- Perform office or non-manual work, and
- Customarily and regularly perform any one or more of the
exempt duties of an executive, administrative or professional employee.
The Salary Level and Salary Basis Tests do not apply to: Outside Sales Employees, Doctors, Lawyers, Teachers, and certain computer-related occupations paid at least $27.63 per hour.
The Job Duties Test allows for exemptions for the following occupations: Executive, Computer, Outside Sales, Learned Professional, Creative Professional, and Administrative.
Child Labor
The law restricts the hours that children under age 16 can work. It forbids the employment of children under 18 in certain jobs deemed too dangerous. Please contact Environmental Health and Safety if your plans include the hiring of someone under 18 years of age.
Recordkeeping
The Health Science Center must keep payroll records for all of its employees. Data recorded includes: employee’s name, address, sex, date of birth, occupation, hours worked each day, total hours worked each week, hourly rate of pay for any workweek in which overtime is due, and total wages paid and deductions taken. These records must be retained for a period of at least three years. Although there exists no prescribed form for timekeeping, Departments must keep accurate daily and weekly records of hours worked by its employees.
Overtime and Compensatory Time
Overtime pay for non-exempt employees is calculated at one-and-one-half-times the regular rate of pay. Although no compensatory time is allowed for private sector employers, public sector employers such as the Health Science Center may offer comp time in lieu of overtime payments. The rules for non-exempt employee comp time under FLSA are:
- Nonexempt employees must agree before overtime is worked
- Compensatory time is accrued at 1.5:1
- Only 240 hours may be accumulated (480 hours for seasonal or emergency response personnel)
- Employees must be given comp time off within a “reasonable” time (usually defined as within one year)
Accrued comp time is a legal obligation.
Summary
As an employee, your responsibilities include verifying time and attendance records of the hours you work (your timesheet). Also, you must not work beyond regular working hours without the knowledge and approval of your supervisor. Managers and supervisors are responsible for understanding the FLSA, and keeping accurate records of employees’ actual hours worked. Further, they should insure that their employees are compensated for all accepted work.
In conclusion, all employees should become knowledgeable of their rights and responsibilities under the FLSA. Congratulations! By getting this far, you have greatly increased your awareness of the law already. Check out the links on the FLSA Toolkit homepage for further discussions and details.
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