What controls does the federal government place on pay?

FAST FLSA FACTS

• FLSA covers every employee in the nation (not otherwise exempt) engaged in interstate activities.

• The federal minimum wage rate is $6.55 per hour, effective July 24, 2008; and will rise to $7.25 per hour, effective July 24, 2009. (Note that some states require a higher minimum wage.)

• A straight-time workweek of 40 hours is permitted.

• Overtime pay, due when work goes beyond 40 hours, is set at time and one-half of the regular rate.

The law does not regulate the frequency of employee compensation, nor does it require breaks during work. Employers must typically pay all wages due employees on regular paydays. However, many state laws provide that employers pay wages according to a specific schedule and provide breaks of certain duration during the workday.

State regulation of wages. Many states have enacted their own laws in these areas reaching employees not covered by the federal law, or, in some cases, providing more protection than the federal law. Employers need to know the wage-hour laws in states where they do business. Be sure to check State Laws for the laws that apply in your state(s).

Why is compliance with wage and how laws so important? Because noncompliance can be very costly. Employers must avoid inadvertent wage-hour violations that could turn into time-consuming investigations and a very large bill for back wages. Additional penalties or damages can be assessed if it can be shown that the employer acted willfully in its noncompliance of the FLSA.

Most employers consider themselves quite familiar with both federal and state wage and hour laws. However, in practice, many employers appear to not fully understand the laws or find them difficult to put into practice.

FLSA recordkeeping requirements. See What records need to be kept for FLSA compliance? at ¶11,210 for information on the FLSA recordkeeping requirements.