FLSA: Minimum Wage and Overtime

While the FLSA is quite extensive, four areas see the most legal activity – meaning these four areas have the most lawsuits where the complaining employee gets paid. Those areas are minimum wage, overtime, meal and/or break periods and equal pay for men and women. For this paper, the term “employee” refers to Wal-Mart Stores Inc.'s non-exempt employees and the items addressed are in no order.

Minimum Wage

The first area of concern is the minimum wage which, while it is not gone into in great depth, is still one of the most litigious provisions of the FLSA. All non-exempt employees employed by Wal-Mart must earn at least minimum wage, which is currently federally set at $7.25 per hour (Mayer, 2013). However, disabled persons are entitled to earn less than minimum wage (Mayer, 2013).

Overtime

The rule here is anytime an employee works over a 40-hour workweek that time is compensable by at least one and one-half times his or her normal hourly rate (Mayer, 2013). Or, comp time may be substituted for overtime according to an agreement between employee and employer (Mayer, 2013). Comp time is compensable at one and one-half times the employee’s normal hourly rate (Mayer, 2013). Simple enough. However, when determining what exactly defines over time, things get a little dicey because what may appear to be an off-duty activity may qualify as time on the clock; thus, if the activity is not generally compensated then after-the-fact calculations could qualify the activity as overtime since it was not included in the usual hourly course (Jacob, 2010). The following is a general (non-exhaustive) list of usually overlooked compensable damages: Dressing up or down for work; work performed during break times such as taking a customer call or discussing store business which then converts the entirety of the break time to compensable work time; training time; waiting for an assignment or waiting time; team building activities which are mandatory; and/or additional travel time to and from training activities (Tenenbaum, 2012).

To avoid miscalculations of employee time, a recordkeeping device must be utilized and employees advised what is and is not allowed during their break times (Jacob, 2010). Employees must be well-trained on whatever record-keeping device is used and must be capable of maintaining specific employee information, such as name, social security number, etc., but also, wage, non-exempt v. exempt, hours, schedule, to name a few (Jacob, 2010).

Finally, while most employers focus on hard costs, such as fines and settlement costs, there also runs the risk of fallback from disgruntled employees whom may or may not have filed suit but taken matters into their own hands by stealing inventory or falsifying records justifying those actions by their perception of unfair treatment by their employer. Shrinkage is no small part of a business’s bottom line and, while no monetary amount can be attributed to it, low morale can be very expensive in other ways (Tenenbaum, 2012).

References

Jacob, G. F. (2010). Avoiding liability for off-the-clock work in the brave new world of the Blackberry. Corporate Counsel Committee News, Fall, 1-20.

Mayer, G. C. (2013). The Fair Labor Standards Act (FLSA): An overview. Congressional Research Service.

Tenenbaum, J. S. (2012). Top ten compensable time issues for non-exempt employees. News & Insights. Retrieved from https://www.venable.com/insights/publications/2012/04/top-ten-compensable-time-issues-for-nonexempt-empl.