Fair Labor and Standards Act

Fair Labor Standards Act

Throughout President Franklin D. Roosevelt’s presidency, he enacted many pieces of legislation that benefited the labor force, through his “New Deal” program. In 1939, he signed one piece of legislation that would become a landmark for the labor movement that was spread across the United States, known as the Fair Labor Standards Act (FLSA). This act enforced into law federal standards for the employees of organizations and companies that participate in interstate commerce, public agencies, and operations of a certain size (Gale, 2000). The FLSA was one of the first acts to be singed into federal legislation that really gave power to employees. It set the standards pertaining for; the rate at which employers must pay their workers, standardized hours worked in a week, and child labor. During the next quarter century, the FLSA’s scope would be broadened to now incorporate all employees in businesses that obtain a certain dollar amount of goods that move in interstate commerce. With the broadened scope of the FLSA, “it now covers between 80 and 90 percent of all persons privately employed outside of agriculture, and a lesser but substantial percentage of agricultural workers and state and local government employees” (Mayer, Waren, Siedel, Leiberman, 2013, p. 1824). During this paper I will break down and discuss the key standards that the FLSA federally regulates as well as explain the law and what the right of the employee and employer are as it pertains to this act. I will also examine the problems with the law as well as discuss possible solutions. I will also cover what businesses should do to ensure that they are in compliance with the FLSA standards.

The first standard to be set was the federal minimum wage, which dictated the minimum amount that an employer could pay a worker for their labor. During this period in American history, many employers had little concern for their employees. The employees were being over worked and under paid. This legislation made it illegal for any employers to pay a wage that was less than which had been deemed federally fair. Along with setting the standard for how much someone is entitled to make in an hour, it also set a limit for how many how many work hours are deemed as full time, which was forty-four hours in 1939, and forty hours now. The FLSA sets these hours in order to be able to compute what time spent working classifies as overtime. The FLSA deemed that any time worked over the maximum-hour work week is to be deemed overtime. For example, if an employee is works forty hours in a week he is only entitles to receive payment for the time worked multiplied by this base pay rate. FLSA has become most well-known as it mandated, that any overtime must be paid at a rate of no less than one and one-half times the employees regular pay. Under these conditions all employees, protected under the FLSA, who worked fifty hours in a given week, are entitled to forty hours to be paid at their base pay rate and ten hours to be paid at a rate of base pay rate, plus one-half base pay rate per hour. While the FLSA requires that over time to be paid at one and one-half times base pay, they are free to exceed this standard amount, they cannot pay any less for overtime. The FLSA also helped to define what time spent related to work, counts as time that must be paid. The FLSA classifies work time as; “all time an employee is required to be at the premises of the employer is work time. All regular shift time is work time. This includes "breaks" (if there are breaks), and "nonproductive" time (for example, time spent by a receptionist reading a novel while waiting for the phone to ring). In addition, all time spent by an employee performing work-related activities that the employer suffers or permits is work time, whether on premises or not and whether "required" or not. Work done "at home" or at a place other than the normal work site is work, and the time must be counted. "Voluntary" work is work, and the time must be counted. "Unauthorized" or "unapproved" work is work and must be counted, provided that the employer knows or should know it is being done and permits the employee to do it” (FLSA.com, n.d.). The FLSA also made it the responsibility of the employers to maintain records of containing the employees’ information as well as records pertaining to all hours worked and all pay records, including tax and deductions. This information serves as proof of FLSA compliance and must be maintained for three years (DOL, 2008). While the FLSA regulates overtime and minimum wage standards it does not have any influence over paid sick days, paid vacation time, severance pay, extra work during any time that is below forty hours, total required hours worked in a workweek, nor employee benefits.