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The FLSA and overtime pay...Fair Labor Standards Act

Many employers are unwittingly violating a U.S. Department of Labor pay rule, and they could pay a high price as a result. In fact, U.S. companies could owe as much as $39 billion in back pay. The rule on overtime compensation has been in effect since 1954, but it has come to the fore, mostly in eco...

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Published in:Public Personnel Management Vol. 32; no. 3; pp. 331 - 355
Main Authors: Crampton SM, Hodge JW, Mishra JM
Format: tables/charts Journal Article
Published: Sage Publications Inc. Fall2003
Online Access:View this record in EBSCOhost
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        atl: The FLSA and overtime pay...Fair Labor Standards Act
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          Crampton SM
          Hodge JW
          Mishra JM
        affil: Grand Valley State University, Seidman School of Business, Management Dept, 463C DeVos Center, 401 W Fulton St, Grand Rapids, MI 49504-6431
      sug:
        subj:
          Salaries and Fringe Benefits Legislation and Jurisprudence
          Employer-Employee Relations
          Flexible Scheduling
          United States
          Workforce Classification
      ab: Many employers are unwittingly violating a U.S. Department of Labor pay rule, and they could pay a high price as a result. In fact, U.S. companies could owe as much as $39 billion in back pay. The rule on overtime compensation has been in effect since 1954, but it has come to the fore, mostly in economically painful ways, because of a handful of recent court decisions and increased Labor Department enforcement action against companies. The rule states that employers must pay hourly employees at one-and-a-half times their hourly rate for each hour over 40 they work in a week. Employers are not required to pay overtime to employees who are paid on a salary basis and who meet certain requirements related to duties. However, employers often don't know which employees qualify for overtime, when to pay it, or whether to pay time and a half or compensatory time. In fact, violations are so common that some estimate that workers would get an additional $19 billion a year if the rules were observed. Perhaps it's time to revisit the provisions and interpretations of the 1938 Fair Labor Standards Act.
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    language: English
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