FAQs

FAIR LABOR STANDARDS ACT (FLSA)
PENSION RIGHTS
DISCRIMINATION

"FAQs: FAIR LABOR STANDARDS ACT (FLSA)

What is the FLSA?
1. The FLSA sets minimum wage, overtime pay, recordkeeping and child labor standards.
Who does the FLSA apply to?
1. The FLSA applies to part-time and full-time employees. The FLSA applies to employees in both the private and public sectors.
What is the federal minimum wage rate?
1. The federal minimum wage rate as of July 24, 2009 is not less than $7.25 per hour for covered nonexempt workers.
2. The federal minimum wage rate for individuals under the age of 20 is not less than $4.25 an hour during the first 90 consecutive calendar days of employment with an employer.
Is minimum wage required for employees that receive tips?
1. Yes. Employers must pay employees receiving tips a cash wage of at least $2.13 per hour. If an employee does not make at least $7.25 per hour from the combination of tips plus the cash wage of $2.13 per hour, the employer is required to pay the difference.
Who is exempt from the minimum wage rate?
1. The following are examples of employees that are exempt from the minimum wage rate:

Casual babysitters

Employees engaged in fishing operations

Employees engaged in newspaper delivery

Executive, administrative, and professional employees (including teachers and academic administrative personnel in elementary and secondary schools)

Farm workers employed on small farms

Outside sales employees

When is overtime due?
1. Overtime pay is required after 40 hours of work in a single workweek. The overtime pay rate is one and one-half times the employee’s regular rate of pay.
What is considered a workweek?
1. The FLSA defines a workweek as a period of 168 hours during 7 consecutive 24-hour periods.
Who is exempt from overtime pay?
1. There are some exceptions to overtime pay for certain professions including:
  1. Announcers
  2. Chief engineers of certain non-metropolitan broadcasting stations
  3. Police officers and firefighters employed by public agencies
  4. Employees of hospitals and nursing homes
  5. Employees of motion picture theaters
  6. Farmworkers
  7. News Editors
  8. Seamen on American vessels
  9. Taxi Drivers
2. The Department of Labor has provided exemption tests for certain employees:
  1. Administrative Exemption
    1. To qualify for the administrative employee exemption, ALL of the following tests must be met:
      1. The employee must be compensated on a salary or fee basis (as defined in the regulations) at a rate not less than $455 per week;
      2. The employee’s primary duty must be the performance of office or non-manual work directly related to the management or general business operations of the employer or the employer’s customers; and
      3. The employee’s primary duty includes the exercise of discretion and independent judgment with respect to matters of significance.
  2. Executive Exemption
    1. To qualify for the executive employee exemption, all of the following tests must be met:
      1. The employee must be compensated on a salary basis (as defined in the regulations) at a rate not less than $455 per week;
      2. The employee’s primary duty must be managing the enterprise, or managing a customarily recognized department or subdivision of the enterprise;
      3. The employee must customarily and regularly direct the work of at least two or more other full-time employees or their equivalent; and
      4. The employee must have the authority to hire or fire other employees, or the employee’s suggestions and recommendations as to the hiring, firing, advancement, promotion or any other change of status of other employees must be given particular weight.
  3. Computer Employee Exemption
    1. To qualify for the computer employee exemption, the following tests must be met:
      1. The employee must be compensated either on a salary or fee basis at a rate not less than $455 per week or, if compensated on an hourly basis, at a rate not less than $27.63 an hour;
      2. The employee must be employed as a computer systems analyst, computer programmer, software engineer or other similarly skilled worker in the computer field performing the duties described below;
      3. The employee’s primary duty must consist of:
        
        1) The application of systems analysis techniques and procedures, including consulting with users, to determine hardware, software or system functional specifications;
        
        2) The design, development, documentation, analysis, creation, testing or modification of computer systems or programs, including prototypes, based on and related to user or system design specifications;
        
        3) The design, documentation, testing, creation or modification of computer programs related to machine operating systems; or
        
        4) A combination of the aforementioned duties, the performance of which requires the same level of skills.
  4. Outside Sales Exemption
    1. To qualify for the outside sales employee exemption, all of the following tests must be met:
      1. The employee’s primary duty must be making sales (as defined in the FLSA), or obtaining orders or contracts for services or for the use of facilities for which a consideration will be paid by the client or customer; and
      2. The employee must be customarily and regularly engaged away from the employer’s place or places of business.
  5. Learned Professional Exemption
    1. To qualify for the learned professional employee exemption, all of the following tests must be met:
      1. The employee must be compensated on a salary or fee basis (as defined in the regulations) at a rate not less than $455 per week;
      2. The employee’s primary duty must be the performance of work requiring advanced knowledge, defined as work which is predominantly intellectual in character and which includes work requiring the consistent exercise of discretion and judgment;
      3. The advanced knowledge must be in a field of science or learning; and
      4. The advanced knowledge must be customarily acquired by a prolonged course of specialized intellectual instruction.
How is vacation pay, sick pay, and holiday pay computed?
1. The FLSA does not require pay for time off. This computation is generally included in an employment agreement.
When are pay raises required?
1. The FLSA does not require employers to provide pay raises. A pay raise is generally discussed between an employer and an employee.

FAQs: PENSION RIGHTS

What is ERISA?
1. The Employee Retirement Income Security Act of 1974 (ERISA) is a federal law that protects pension and health plans in the private industry by setting minimum standards.
What is COBRA?
1. The Consolidated Omnibus Budget Reconciliation Act (COBRA), is an amendment to ERISA. It provides individuals with an opportunity to continue their heath care benefits after the loss of a job.
What is HIPAA?
1. The Health Insurance Portability and Accountability Act (HIPAA) is another important amendment to ERISA. HIPAA protects workers from discrimination in health coverage based on preexisting medical conditions and other factors relating to the worker’s health.
Does ERISA cover government employees?
1. ERISA does not cover group health plans established by the government. This protection is only for workers in the private sector.
Does ERISA require private employers to set up a pension plan?
1. No. ERISA only requires private sector employers that have a pension plan to comply with the minimum standards.
If an employer is laid off, is he entitled to his retirement money?
1. It depends on the type of pension plan that the employer has and the terms of the Plan. There are two types of pension plans: defined contribution plan and defined benefit plan.
2. If the employee has a defined contribution plan, a plan in which the employee and employer contribute to the individual account, then the employee may be entitled to a lump-sum distribution of the pension once the employee leaves the company.
3. If the employee has a defined benefit plan, a plan that is funded by the employer and provides a specific benefit amount at retirement or that is based on a fixed formula of factors such as the number of years worked and salary, then it depends on whether the employee has satisfied the conditions for receipt of the retirement benefits.

FAQs: DISCRIMINATION

What is Title VII of the Civil Rights Act of 1964?
1. Title VII is a federal anti-discrimination law that prohibits an employer from discriminating on the basis of race, national origin, gender, or religion. It also bars discrimination based on pregnancy.
Does Title VII apply to all employers?
1. No. Title VII only applies to employers with fifteen or more employees.
What types of actions are prohibited by employers under Title VII?
1. Title VII prohibits an employer from taking the following actions against an employee based upon his or her race, national origin, gender, or religion:

Refuse to hire;

Discipline;

Fire;

Deny training;

Fail to promote;

Pay less or demote; or

Harass.

Can a white male be subject to discrimination?
1. Yes. Male or white employees or applicants can be the subject of discrimination. This form of discrimination called reverse discrimination has been recognized by Title VII.
Is it discrimination if a comparable male and woman employee receive a different amount of pay?
1. There may be a claim. The Equal Pay Act prohibits discrimination on the basis of sex where a male and woman perform substantially equal work.
Does the Equal Pay Act apply to all employers?
1. No. It applies to employers that are already subject to the Fair Labor Standards Act.
Who does the Age Discrimination in Employment Act (ADEA) protect?
1. The ADEA protects employees and applicants who are over the age of forty from discrimination.
Does the ADEA apply to every employer?
1. No. The ADEA only applies to employers with twenty or more employees.
Are employees with disabilities protected from discrimination?
1. Yes. There are two federal laws that provide protection from discrimination for employees with disabilities.
2. The Americans with Disabilities Act (ADA) protects employees in the private sector from disability discrimination. The ADA only applies to employers with more than fifteen employees.
3. The Rehabilitation Act applies to all government entities and federal contractors.
Are employers with less than fifteen employers barred from national origin discrimination?
1. Yes, with one exception. The Immigration Reform and Control Act bars employers with more than three employees from discriminating on the basis of national origin.
Is an employee that is not a U.S. citizen protected under the Immigration Reform and Control Act?
1. Yes. The Act also applies to an “intended citizen,” an employee that can legally work in the U.S. but is not a citizen.
What is the EEOC?
1. The Equal Employment Opportunity Commission (EEOC) is a federal agency that enforces discrimination laws. The EEOC investigates claims brought under Title VII, the ADEA, the ADA, or the Rehabilitation Act.