Fair Labor Standard Act

The Fair Labor Standards Act (FLSA) of 1938, as amended, is published in the United States Code, particularly in sections 201-219 of title 29. The FLSA includes provisions related to equal pay, youth employment, and recordkeeping standards involving employees in the private sector and in local, State, and Federal governments. It provides for the minimum standards for overtime claim and wages, and explains administrative procedures in compensating covered work period.

Certain provisions of the FLSA exempt groups of employees or particular employees from the coverage. This exemption mainly applies to executive, administrative, and professional employees, or also known as “white collar” workers. The FLSA is occasionally adjusted and amended to keep the standards suitable to the current working environment. In spite of these progressions, all US-based companies are continually required to adhere to the Act.

Impact of the Law to Companies/Industries

Currently, the Fair Labor Standard Act equally protects employees who work in the private and public sectors. All employees of companies engaged in interstate commerce, manufacturing products for interstate commerce, or selling, handling, or otherwise working on materials or products that have been produced or moved in for such commerce by any company and go beyond $500,000 in annual sales are obliged to conform with the FLSA.

Domestic service workers such as full-time babysitters, cooks, chauffeurs, housekeepers, or day workers are also covered if: (1) within a calendar quarter they receive no less than $50 cash wages from their employers; or (2) within a week they aggregately worked for more than 8 hours for at least one employer. The FLSA also covers other companies irrespective of annual revenue, which include schools, colleges and universities, medical facilities, and all government agencies. In addition, any company that was covered by FLSA on March 31, 1990, but due to the increase of coverage dollar volume ceased to be covered must still continue recordkeeping, child labor, and overtime pay practices in accordance with the provisions of FLSA.

Violations concerning the FLSA arise when: (1) after completing 40 hours of work in a single week, the overtime wage of the employee is not being paid at one and a half times of his or her standard hourly rate of pay; (2) the employer is not making up the difference between the employee’s combined tips and cash pay total and the legal minimum hourly wage, which is presently over $2 per hour; and (3) Federal Minimum Wage is not paid on an hourly basis (United States Department of Labor). Given that these concerns were primarily developed for manufacturing-based industries and the private sector, their application to the public sector has initially caused several difficulties, bringing in the subject of “exempt” status to a considerable number of public employees.

Impetus and Evolution

During the 1930s’ economic depression, organized labor and subsequently the unionization of unskilled workers grew considerably. Accordingly, the Fair Labor Standards Act of 1938 was enacted to combat unemployment and to help maintain a suitable living standard for low-wage workers. It was originally designed and enacted to cover only the private sector. Before the enactment of the FLSA, the privately employed workers and the United States Congress believed that wages provided by privately owned companies were so low to sustain an acceptable way of living to the workers, and that these hourly paid workers had no bargaining power or protection with respect to their employers. Unfortunately, in order to survive, the workers during the time had no choice but to accept their employers’ substandard wages.

The Federal government enacted the FLSA in order to set a wage floor and to protect the public from cheap labor practices. Besides the implementation of minimum wage, the Federal government through FLSA also tackled issues of child labor, equal pay, employee recordkeeping, and overtime compensation (United States Department of Labor). In addition, it considered unlawful to discriminate against, or otherwise discharge an employee, on account of the latter’s filing of complaint or testifying in FLSA related cases.

It was only in 1974 that the FLSA was amended to incorporate the public sector. Nevertheless, the legality of the amendment was disputed in the United States Supreme Court through the case National League of Cities v. Usery. The Court ruled in the aforesaid case that the 10th Amendment to the Constitution rendered unconstitutional the application of the FLSA to the public sector. Nevertheless, the ruling was overturned nine years after by the Supreme Court in the Garcia v. San Antonio Metropolitan Transit Authority decision.

Today, as specified in section 3(e) (2) of the FLSA, the Act is applicable to any individual employed by the United States Government. In applying the Fair Labor Standards Act to employees of the United States Federal Government, the Office of Personnel Management necessarily works with Federal agencies. Because of this development, the FLSA are affecting millions of companies and millions more of full-time and part-time workers in the private sector and in local, State, Federal governments.

Conclusion

In recent decades, the Fair Labor Standards Act has been repeatedly amended, including increase in the minimum wage; expansion of the classes of covered workers; equal pay scales for men and women; increase overtime payments; and redefinition of regular-time of work. In today’s age of global economic adjustments and remarkable modifications of American work force, the Fair Labor Standards Act clearly still stands as the most excellent tool for protecting and enforcing the wages and other rights of non-exempt employees.

Reference

United States Department of Labor. (n.d.). Compliance Assistance – Fair Labor Standards Act (FLSA).  Retrieved April 3, 2009, from http://www.dol.gov/esa/whd/flsa/