6 Tips to Help Your Company Avoid Fair Labor Standards Act (FLSA) Violations
The Fair Labor Standards Act (FLSA) was originally established in 1938 and has since seen numerous updates and amendments. This federal statute governs numerous aspects of employment law, such as things like minimum wage, overtime, child labor laws, and much more. The FLSA is a complex piece of legislation, and it can be incredibly easy for a business to violate certain aspects of the law. Particularly in the Digital Age, with companies utilizing more independent contractors, telecommuting, and employee travel, there can be a great deal of ambiguity surrounding employer obligations with regard to the FLSA. What hours are compensable? Do hours worked from home qualify for overtime? Who is exempt from FLSA standards? These are not easy or clearcut questions for most employers, and violations of this major employment law can result in costly and damaging lawsuits. There are many ways, however, in which you can be proactive and help ensure your company maintains FLSA compliance. Below we have detailed six tips to help your business take action to avoid FLSA violations. Please keep in mind, these tips are not intended as legal advice for your specific situation. You should always consult with a skilled business attorney who can analyze your company’s circumstances and needs with regard to FLSA compliance. Contact The Campbell Law Group today to learn more. 1) Understand FLSA Exemptions The FLSA details precisely which types of employees the legislation applies to, and which types of employees are exempt from aspects of the law’s requirements such as overtime pay. There are two main tests that determine whether an employee is exempt or non-exempt: the salary test and the duties test. Some of the exemptions under the duties test include executives, outside salespeople, highly compensated employees, and administrative employees. Employees are exempt under the salary test if they earn at least $455 per week. Misclassifying employees as exempt when they should be non-exempt is one of the biggest causes of FLSA violations, so be sure you fully understand how the exemptions work. 2) Self Audit Consistently perform self audits of your company’s FLSA compliance. Allow a knowledgeable business attorney to analyze your company’s policies and identify potential FLSA risk factors you should address. If you perform audits yourself, you will prepared if you are ever audited by the Department of Labor, and be better equipped to handle any lawsuits that arise. 3) Beware of digital complications In the Digital Age, numerous workers are constantly connected to their workplace through their phones and other portable electronics. If you have non-exempt employees who are checking and responding to emails in a manner which benefits your company—even if you did not ask them to—the time spent responding to emails could be compensable and count towards overtime. Be aware of your obligations with regard to digitally connected employees. 4) Require employees to take lunch away from workplace You are required to pay for the hours that an employee works. If you allow for an unpaid lunch break, and the employee remains at their workplace, they may feel obligated to work during their lunch break. You will be required to compensate them for that time. If you want employee lunch breaks to remain unpaid, require them to take their lunch breaks away from their work space. 5) Educate managers on FLSA-related policies Your managers are the ones who exercise the most control over keeping employees in compliance with company policies that are meant to protect you from FLSA violations. Ensure that your managers are properly trained and aware of your rules and regulations when it comes to FLSA-related policies so that they can adequately enforce them. 6) Develop well-defined complaint policies and procedures If you develop clear and effective employee complaint policies, you can give employees an outlet to remedy potential issues before the problem escalates into a lawsuit. For example, if an employee believes they were not paid the overtime they deserved, they could follow your guidelines for issuing a complaint, giving you the opportunity to address and rectify the issue rather than forcing the employee to seek legal remedies. FLSA compliance is a constant battle for businesses. If you need assistance with ensuring that your policies and procedures are FLSA compliant, or you are facing an FLSA lawsuit, please contact The Campbell Law Group today and let us fight to protect your company.