Fair Labor Standards Act

Calculation of “regular rate” of pay is something which has long given employers fits, and the US Department of Labor (“DOL”) has taken a step which it hopes will clarify the definition, something which hasn’t been done in 50 years.  On December 12, 2019 the Final Rule interpreting “regular rate” was announced.

Under the Fair Labor Standards Act (“FLSA”) employers are required to pay non-exempt workers time and one half the “regular rate” for every hour worked over 40.  According to the regulations, the “regular rate” includes all remuneration paid to the employee except for certain payments specifically excluded under the FLSA.  This would include wages paid by the hour, by salary, or by piecework and most bonuses, commissions, incentive pay, shift differentials, and on-call pay. Excluded payments, by definition, are premium payments for certain work (e.g. Sunday premium pay), discretionary bonuses, holiday gifts, and vacation pay.


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It’s that time of year HR Pros!  Holiday parties, too much food and drink, devolving into that awful HR role of party planner and gift giver, and a list a mile long of things you meant to get to before year end which, somehow, just didn’t get done.  Here’s an idea.  Let’s not think about what we didn’t do, but focus instead on a real plan for what we realistically can accomplish in 2020, the start of a brand new decade!  I’m not talking about strategic planning or high level forecasting for your business, which is of course critical to success.  I’m talking about simple things which you know you should do (or we employment attorneys have been telling you  to do); things you can do yourself or delegate. Here’s my list of 2020 to-do’s!

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During the month of September, the Department of Labor will be holding a series of “Listening Sessions” throughout the country in order to hear public comments about planned changes to the overtime rules under the Fair Labor Standards Act.

On this blog, we have followed the long and winding path of the years-long efforts to update the FLSA’s overtime rules (see our posts on the subject here, here, here, here, here, here, here, here, here, and here).  To recap, in 2014, the Obama Administration set out to overhaul the overtime rules, and, after nearly two years, issued a set of final regulations, which were to have gone into effect on December 1, 2016. Among other things, these regulations would have increased the minimum salary threshold for exempt workers from $455 per week to $913.  This change would have dramatically increased the number of workers who would be classified as non-exempt, and therefore eligible to earn overtime pay.  However, after President Trump’s election, and just days before the regulations were to take effect, a federal court issued an injunction halting the changes.  After almost a year of litigation and uncertainty, the Trump Administration finally abandoned the Obama Administration’s regulations and went back to the drawing board and started the entire rulemaking process over from scratch.


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The U.S. Department of Labor recently initiated a nationwide pilot program referred to as the Payroll Audit Independent Determination (“PAID”) program.  The stated purpose of the program is to facilitate resolution of potential overtime and minimum wage violations under the Fair Labor Standards Act (“FLSA”).  The expectation is that FLSA claims will resolve more expeditiously and without litigation thus improving employer compliance with wage and hour laws and getting back wages to employees more quickly.

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Last week, the Department of Labor issued new guidance on whether interns are “employees” covered by the Fair Labor Standards Act’s minimum wage and overtime provisions.  In the updated guidance, the DOL has adopted the “primary beneficiary test,” first applied by the U.S. Court of Appeals for the Second Circuit in 2015, and used by a growing number of courts in recent years.

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The United States Department of Labor (“DOL”) yesterday released its long awaited final rule which revises the salary test for the “white collar” exemptions to the Fair Labor Standards Act (“FLSA”).  The new rule will be effective December 1, 2016 and is expected to impact some 4.2 million salaried workers based simply on the revision

It is no surprise that businesses often struggle with categorizing workers as employees versus independent contractors.  The U.S. Department of Labor’s (“USDOL”) latest  guidance highlights a similar challenge businesses face, but may overlook, especially those using staffing agencies  or hire temporary workers to supplement their workforces: the issue of joint employment.  On January 20, 2016,