What is the Fair Labor Standards Act (FLSA)?

Federal law establishing minimum wage, overtime pay, recordkeeping, and youth employment standards. It determines which employees are entitled to overtime pay and governs how hours worked are calculated.
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The Fair Labor Standards Act (FLSA) is a federal law enacted in 1938 that establishes minimum wage, overtime pay, recordkeeping, and youth employment standards for employees in the private sector and in federal, state, and local governments. Often called the "wage and hour law," the FLSA is one of the most important pieces of employment legislation in the United States.

The FLSA affects millions of full-time and part-time workers and serves as the foundation for fair compensation practices across virtually every industry. Understanding FLSA requirements is crucial for both employers seeking compliance and employees protecting their rights.

Who is Covered by the FLSA?

The FLSA covers any business that:

Even if an enterprise doesn't meet the above criteria, individual employees are covered if their work regularly involves:

There are some common exceptions to these rules, including:

Regardless of size or revenue, hospitals, schools, and government agencies at every level are subject to FLSA. 

What does FLSA require?

Minimum wage

The current federal minimum wage is $7.25 per hour, effective since July 2009. This applies to all covered, non-exempt employees. State and local rules also apply:

There are a few exceptions to note:

Tipped Employees:

Youth Minimum Wage:

Training Wages:

Overtime

The regular rate includes:

Excludes:

Keep the following overtime rules in mind:

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What are the FLSA Record-Keeping Requirements

Required Records

Employers must maintain records for each employee showing:

Retention Requirements

Best Practices

Child Labor Provisions

Age-Based Restrictions

Ages 14-15:

Ages 16-17:

Age 18 and Older:

Prohibited Occupations for Minors

Agricultural Exceptions

Different, generally more lenient rules apply to agricultural work, including family farms.

What happens if we violate FLSA?

Department of Labor (DOL) Enforcement

Potential Penalties

Back Wages:

Civil Penalties:

Criminal Penalties:

Employee Rights

What are the most Common FLSA Violations?

Overtime Violations

Minimum Wage Violations

Record-Keeping Violations

Classification Errors

Best Practices for FLSA Compliance

For Employers

Policy Development:

Classification Reviews:

Time Tracking:

Training Programs:

For Employees

Know Your Rights:

Documentation:

Conclusion

The Fair Labor Standards Act remains the cornerstone of American employment law, protecting millions of workers and establishing fundamental standards for fair compensation. While the law's basic principles haven't changed significantly since 1938, its application continues to evolve with changing work patterns, technology, and business models.

For employers, FLSA compliance requires ongoing attention to classification decisions, accurate record-keeping, and proper calculation of wages and overtime. Non-compliance leads to back wages, penalties, and legal fees that can far exceed your investment in proper systems and training.

For employees, understanding FLSA rights helps ensure fair treatment and proper compensation. The law provides strong protections, but employees must be informed advocates for their own rights.

Success in FLSA compliance comes from treating it as an ongoing process rather than a one-time task. By understanding and following these requirements, we maintain workplaces that respect both business needs and worker rights.

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