The wage and hour law establish the standard of payment for employees. It protects the employees’ rights to monetary benefits by defining the minimum wage plus the fee for the overtime services rendered by the workers.
In the United States, the Fair Labor Standards Act (FLSA) enforces the requirements of the wage and hour law at the federal level. Meanwhile, each state can also redefine their rules within their jurisdiction.
Unfortunately, some employers fail to abide by these rules. Examples of non-compliance include failure to give the exact minimum wage and overtime payment, and the deduction of costs for goods like food plus the tips received.
Thus, in this article, we will discuss the key things you need to know about wage and hour law.
- Employers Need To Pay Their Employees Who Render Overtime Services
The FLSA mandates all employers to pay their employees who render overtime services at a rate of 1.5-times the regular pay rate of the employee.
The application of the act has a workweek basis. Moreover, employees can receive the payment of the overtime earned during a particular workweek on the regular payday.
Take note as well that the act does not prohibit the number of hours that an employee ages 16 years old and above may work on any day. Also, it doesn’t require overtime pay on a Saturday, Sunday, or even holidays unless overtime is necessary.
Meanwhile, the law also divides the employees into who can and cannot avail the overtime standards. These are the:
- Exempt employees-white collar jobs such as administrative, executive, sales, and professional services are not subject to overtime requirements because:
- They receive salary as opposed to hourly payment
- They earn at least $455 ($913 as of 2016) per week
- Non-exempt employees- the law mandates a minimum wage and overtime exemption for first responders like police officers, paramedics, and firefighters, plus the blue collar jobs such as electricians, carpenters, and construction workers
- State Must Set Rates The Same Or Above The Federal Wage Rate
The current minimum federal wage is at $7.25 per hour, but each state can set higher rates. Here are some considerations in the wage rate:
- If a state offers a higher rate than the federal wage rate, then the employees will receive the higher hourly rate instead.
- Meanwhile, if a state does not have a minimum wage or their rates are lower than the standard set by the federal law, workers will receive the $7.25 minimum hourly payment.
Thus, the employers must abide by these rules to protect the rights of their employees.
- Employers To Pay Wage Even Tipped-Employees
Employers are still required to pay their employees the minimum wage rate even if they receive tips from customers. It is known as the ‘tip credit.’ Here are some of its requisites:
- An employer is required to pay the employee of only $2.13 per hour if that amount plus the tips is equivalent to the minimum federal wage rate of $7.25 per hour
- If the tips of the employee plus the employer’s direct wages of at least $2.13 per hour is still below the federal wage rate of $7.25 per hour, then the employer must give the sum difference
Employers must involve disclosures with their employees in using the tip credit. If they fail to make appropriate disclosures, they might pay the federal minimum wage plus they can allow the retainment of the tips received.
- States Must Establish Payday Requirements
The majority of states today has already established the minimum frequency for paying employees (except South Carolina and Alabama). Typically, employers pay employees with the following rate:
- Twice a month, every other week
- Weekly payment
- Monthly payment
In some states, they also make distinctions as to the type of industries or business, whether public or private sector. For example, workers in farm labor in California must receive wages once a week. Meanwhile, private sector employees in Hawaii must receive their salary once a month as opposed to the semi-monthly paycheck of the public employees.
In a nutshell, employers must provide to their employees the appropriate compensation for their work since they play a crucial role in the company.
In drafting contracts and guidelines, employees must remember the standards set by the federal and state laws to pay the workers’ minimum wage and overtime services. Such instructions must be explained well to the employees to prevent confusion and establish a smooth relationship with each other.
Failure to provide the rights of the employees can result in lawsuits in the long run. Cases in the court can affect the running of the business, plus it can tarnish the image of the employer. If you wish to know more about the wage and hour laws, you can ask information from a lawyer, such as those found here.
This is a guest post by Adeline Robinson. She is one of most promising young law writers. She writes pieces on law topics for common readers. She is an avid sports fan and loves watching games if she has free time.