Fair Labor Standards Act of 1938: Minimum Wage and Overtime Protections for Workers

Congress enacted the Fair Labor Standards Act (FLSA) in 1938—in the midst of the Great Depression—to combat the pervasive “evils and dangers resulting from wages too low to buy the bare necessities of life and from long hours of work injurious to health.” S. Rep. No. 75–884, at 4 (1937); Salinas v. Commercial Interiors, Inc., 848 F.3d 125, 132–33 (4th Cir. 2017). Congress intended the FLSA “to free commerce from the interferences arising from the production of goods under conditions that were detrimental to the health and well-being of workers,” Rutherford Food Corp. v. McComb, 331 U.S. 722, 727 (1947), and “to protect the rights of those who toil, of those who sacrifice a full measure of their freedom and talents to the use and profit of others.” Benshoff v. City of Va. Beach, 180 F.3d 136, 140 (4th Cir. 1999) (internal quotes and cites omitted).

The FLSA establishes a federal minimum wage and requires employers to pay “a rate not less than one and one-half times the regular rate” to employees who work more than forty hours in a single workweek. 29 U.S.C. §§ 206(a), 207(a)(1). Under the FLSA, a workweek is generally (with few exceptions) a period of 7 consecutive 24 hour periods (168 total hours). Employees covered under the FLSA must be paid for all hours worked in a workweek. As defined by the statute the term “employ” includes “to suffer or permit to work.” 29 U.S.C. § 203(g). An employee’s hours worked includes all time an employee must be on duty, or on the employer’s premises or at any other prescribed place of work, from the beginning of the first principal activity of the workday to the end of the last principal work activity of the workday. See DOL Fact Sheet #22 on Hours Worked and regulations at 29 C.F.R Part 785. The FLSA also establishes employer recordkeeping requirements and youth employment standards. See 29 C.F.R. Part 516 (record keeping) and 29 C.F.R. Part 570 and DOL Fact Sheet #43 (youth employment). The FLSA applies to all covered, non-exempt employees in the private sector, as well as federal, state, and local governments.

Effective July 24, 2009, the FLSA established that all covered non-exempt workers are entitled to a minimum wage of no less than $7.25 per hour. Many states, however, have enacted their own state minimum wage laws. Some state laws provide greater protections for workers and a higher minimum wage, compared to the federal law. Should an employee be subject to both state and federal minimum wage, the law entitles the employee to the higher wage.

The FLSA covers all employees of enterprises that have workers engaged in interstate commerce, or the handling, selling, producing, or working on goods or materials that have been moved or produced for commerce between states or foreign countries. Some employees are not covered under all or part of the FLSA, because their job duties render them exempt from the law’s overtime pay provisions or from both the minimum wage and overtime pay provisions. An employee who is “exempt” from the overtime pay provisions is not entitled to overtime pay for time worked over 40 hours in a workweek.

Exemptions from Overtime Pay

The following are some examples of overtime pay exemptions. This list is illustrative and does not include every exemption. These examples simply identify some categories and do not define the conditions for each exemption:

• Certain commissioned employees of retail or service establishments; auto, truck, trailer, farm implement, boat, or aircraft sales-workers; or parts-clerks and mechanics servicing autos, trucks, or farm implements, who are employed by non-manufacturing establishments primarily engaged in selling these items to ultimate purchasers;
• Employees of railroads and air carriers, taxi drivers, certain employees of motor carriers, seamen on American vessels, and local delivery employees paid on approved trip rate plans;
• Announcers, news editors, and chief engineers of certain non-metropolitan broadcasting stations;
• Domestic service workers living in the employer’s residence;
• Employees of motion picture theaters; and
• Farmworkers.

The FLSA’s overtime only exemptions are located at 29 U.S.C. § 213(b).

Exemptions from Both Minimum Wage and Overtime Pay

The following are some examples of employees whose job duties render them exempt from both the FLSA’s minimum wage and overtime pay laws. This list is illustrative and does not necessarily identify every type of exempt employee. These examples simply identify the major exemption categories and do not define the conditions for each exemption:

• Executive, administrative, and professional employees (including teachers and academic administrative personnel in elementary and secondary schools), outside sales employees, and employees in certain computer-related occupations (as defined in DOL regulations)
• Creative and learned professionals–have the primary duty of performing work that requires invention, imagination, originality or talent in a recognized field of artistic or creative endeavor.
• Highly compensated employees–having a total annual compensation of at least $100,000, (or $134,004 under the new regulations).
• Employees of certain seasonal amusement or recreational establishments, employees of certain small newspapers, seamen employed on foreign vessels, employees engaged in fishing operations;
• Farmworkers employed by anyone who used no more than 500 “man-days” of farm labor in any calendar quarter of the preceding calendar year;
• Casual babysitters and persons employed as companions to the elderly or infirm.

The FLSA’s minimum wage and overtime pay exemptions are located at 29 U.S.C. § 213(a). Regulations interpreting various FLSA exemptions are located at 29 C.F.R. Part 541.

Recording Keeping Requirements

Under the FLSA, employers are required to keep records on wages paid, hours worked, and other employment items. See 29 C.F.R. Part 516. The FLSA records that employers must keep include but are not limited to:

• Personal information–employee’s name, home address, occupation, sex, and birth date if under 19 years of age;
• The beginning of the workweek;
• Total hours of each workday and workweek
• Total daily or weekly straight-time earnings;
• Regular hourly pay rate for any week when overtime is worked;
• Additions or deductions to wages
• Total overtime pay in the workweek
• Total amount of wages paid out each pay period,
• Date of wage payment and pay period covered.

See 29 C.F.R. Part 516.

Anti-Retaliation

The FLSA also prohibits employers from retaliating against employees who have complained about violations of the FLSA. See 29 U.S.C. § 215(a)(3) (anti-retaliation provision). If an employee makes such a complaint, the FLSA prohibits her employer from discharging or otherwise discriminating against her because of her complaint. If an employer does take an adverse action against an employee for complaining about FLSA violations, the affected employee may file a suit for relief.

Relief Available

If successful on a claim for unpaid wages or retaliation, an employee may recover her lost wages, liquidated damages (in an amount equal to the lost wages), reinstatement of her job (where applicable), as well as reasonable attorney’s fees and costs. See 29 U.S.C. § 216(b).

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