Incorrect Interpretations of the FLSA Can Get Costly in a Hurry
Posted: January 12, 2024
The Fair Labor Standards Act (FLSA) can be a veritable legal liability minefield for the uninitiated.
According to a January 11, 2024, press release from the U.S. Department of Labor (DOL), a Pennsylvania home health care agency and its owner signed a consent order that requires them to pay approximately $1.6 million in back wages and liquidated damages to 288 workers deliberately denied overtime pay.
The DOL's Wage and Hour Division (WHD) claims that its pre-litigation investigation uncovered several violations.
For example, covered employees must receive overtime pay for hours worked more than 40 in a workweek of at least one and one-half times their regular rates of pay. In this case, the WHD alleged that employees were paid at their regular rates of pay for all hours worked, even when they worked more than 40 in a workweek.
Another pitfall is employees working different jobs (sometimes at different rates) for different customers or clients. An employer must aggregate that time and pay for wage and hour purposes if the work occurs in the same workweek. Here, the defendants did not combine hours between multiple clients for overtime calculation purposes.
Under the FLSA, an employee's time spent traveling as part of their principal activity (other than their normal commute), such as travel from job site to job site during the workday, is work time, and the employer must count it as hours worked. Here, employees did not receive pay for time spent traveling between clients' homes in the same workday.
The FLSA also has several recordkeeping requirements. The WHD claims that the employer maintained inaccurate records of hours worked due to not tracking hours for travel time and kept zero payroll records for part of the investigation period.
Also, for defendants the FLSA's definition of "employer" is broad enough to include individuals who exercise or have sufficient control over the conditions and terms of a worker's employment. So, a plaintiff (employee) can name both the employer and a supervisor, HR professional, owner, etc., as a defendant, too.
Posted In: Department of Labor (DOL); Fair Labor Standards Act (FLSA); Wage and Hour Laws
Want to know more? Read the full article by Eric B. Meyer at The Employer Handbook