CLASS THREE-COMPENSATION

Fair Labor Standards Act-Overview The Fair Labor Standards Act (FLSA) establishes a federal minimum wage, maximum number of hours of work, overtime pay, and the regulation of child labor for employers in interstate or foreign commerce, as well as employees of state and local governments. Where state law provides greater protection to workers than the federal law, workers can take advantage of the state law. Employers subject to the FLSA include all enterprises engaged in interstate commerce or producing goods intended for interstate commerce, all hospitals, schools and public agencies. Businesses not engage in interstate commerce are excluded, but only if their annual gross volume is less than $500,000.

Fair Labor Standards Act-Coverage and Wages Establishes federal minimum wage, maximum hours of work, overtime and child labor law regulation for employers involved in interstate or foreign commerce Job duties, not job title, determine whether employee exempt Current minimum wage (as of July 2007) is $5.85 per hour, being raised to $6.55 her hour as of July 2008. Certain smaller employers are exempt from the overtime and minimum wage requirements- local retail and service establishments, small agricultural operations, small town newspapers having less than 4,000 subscribers, and recreational and amusement establishments and camps.

Fair Labor Standards Act- Rules and Limitations Duties imposed on Non-Exempt Employees: Pay at least minimum wage to employees Pay overtime at least 1 ½ times average hourly pay Pay men and women equally for equal work Maintain certain child labor standards Maintain specified payroll records Areas not regulated under FLSA: Overtime for weekends or holidays Vacation, severence, sick pay, rest periods Pay raises and fringe benefits

Fair Labor Standards Act-Exempt Employees White Collar exemptions under the FLSA: 1. Executives- those who supervise at least two full-time employees and have the power to hire and fire 2. Administrative-office or non-manual work directly related to management policies or general business operations-e.g., treasurer, personnel director 3. Professional-occupations requiring advanced knowledge and study-e.g. attorneys, physicians, nurses 4. Outside salespersons- they regularly work away from the employer’s place of business in making sales or obtaining orders for services, at least 80% of the time

Fair Labor Standards Act-Working Hours How Hours Are Calculated: The workweek consists of 7 consecutive 24-hour periods, and need not begin on any particular day. Rest periods (up to 20 minute breaks) are counted as hours. Lunch hours normally do not count as hours, unless the employee is required to perform duties while eating. Time spent commuting from home to work, and vice versa, does not count. However, time spent going from one job site to another, during the workday, or travel to a conference or meeting place, will count as hours.

Fair Labor Standards Act-Hours and Overtime Waiting time (e.g. messengers waiting between runs) counts as hours, where the employee is required to remain on call and cannot readily use the time for his or her own purposes. Overtime must be paid for all hours over 40 hours per week, but certain employees are not covered by overtime provisions (e.g. law firm associates who routinely put in 70-80 hour weeks at certain law firms receive no overtime pay; however, paralegals who put in similar hours have a legal right to overtime). The FLSA allows governmental entities to give compensatory time off in lieu of overtime pay.

Fair Labor Standards Act-Procedures Enforcement of FLSA claims: 1. The statute of limitations for FLSA claims is two years from the date of the violation for ordinary damages, and three years from the date of the violation for willful violations of the statute. 2. Back wages and attorneys’ fees can be recovered. 3. Where the Secretary of Labor brings an action, injunctive relief and civil penalties are recoverable. Violations of child labor laws may lead to fines of up to $10,000, or, for a second violation, imprisonment of up to six months.

Fair Labor Standards Act-Illustrative Case 1 In Navarro v. Broney Automotive Repairs, 2008 U.S.Apps. Lexis 12346 (11th Cir.) , an employee was hired to pick up auto parts from a local supply store and bring them to the employer’s premises, where they were used in repairs on domestic and foreign cars. Although the parts came from out of state, they were removed from interstate commerce once they reached the local supply store. The court held that the overtime rules of the FSLA did not apply.

Off-Duty Employees Required to Be On-Call An employee who is required to remain on call at or near the employer’s premises is considered to be “working.” See 29 CFR 785.17. However, in one case, employees who were on their own except that they had to stay within two hours of the work site, were not deemed to be “working.” Jonites v. Exelon Corp., 522 F.3d 721 (7th Cir. 2008).

Equal Pay Act-Overview Equal Pay Act (EPA) 1963 – “Prohibit Discrimination in the payment of wages by employers engaged in commerce or in the production of goods for commerce.” Only protected class under EPA is sex Prohibits pay differentials predicated primarily on gender “Substantially Equal” – standard used by employers in paying male and female employees.

EXCEPTIONS UNDER THE EPA The EPA limits an employer’s right to set pay scales only where the men and women in question are truly similarly situated. An employer may base pay on the number of years of service, even if most of the men in a given department have been there for a longer period of time than most of the women. Pay can lawfully be based on merit or quantity or quality of production on the basis of seniority or merit.

EPA-Illustrative Cases In Hankinson v. Thomas County Sch. System (U.S. Ct. of Appeals, 11th Cir.), the coach of a women’s softball team alleged that the coach of a men’s baseball team was unlawfully being paid more than she was. The court held that the case would have to be determined by looking at such factors as the number of games played and the relative fund-raising responsibilities of the two coaches. One court found it was lawful to pay a male manager of a large state park (with extensive facilities) more than a female manager of a much smaller park. Sims-Fingers v. City of Indianapolis, 493 F.3d 768 (7th Cir.).