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Fair Labor Standards Act Compliance Training

by David Khan on 12/31/2003
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In 1938, Congress enacted the Fair Labor Standards Act (FLSA). This federal legislation mandates payment of minimum wage, overtime pay, restrictions on the employment of children, and record keeping. Because this law is complex and can lead to hefty penalties, compliance training should be provided to all employees at the supervisory level. Moreover, the Department of Labor's new "Fair Pay" regulations are scheduled to become effective mid-August, so it is even more imperative that relevant employees receive training on the changes.

Minimally, training should:

  • describe the FLSA and the characteristics that qualify an individual to be protected under it;
  • address the factors that establish employees as being exempt or non-exempt;
  • identify the white-collar exemption categories (Professional, Administrative, Executive, Outside salesperson, Computer-related professional); and
  • summarize the regulations regarding minimum wage and overtime as it relates to non-exempt employees.

More intricate training should be provided dependent upon an individual's specific job functions. In addition to understanding the fundamental principles, particular employees must also be aware of changes to the FLSA, i.e. the recent Congress decisions concerning white-collar exemptions and overtime.

These individuals may also need to be knowledgeable on other wage and hour laws, such as the Davis-Bacon and Related Acts, which requires payment of prevailing wage rates and fringe benefits on federally-financed or assisted construction; the Wage Garnishment Law, which governs individuals' income that may be legally garnished; and the Equal Pay Act provisions of the FLSA, which prohibits sex-based wage discrimination.

Training Delivery

While all FLSA compliance training should be tied to the organization's policies and procedures, the law does not express the method in which training should be delivered. Written manuals and seminars are common, as are live or videotaped lectures. Online training is also an option. With online training, organizations are able to present timely, essential instruction in compliance, risk management, and even professional development to employees in a consistent and cost-effective manner. Certain online options also enable organizations to make immediate updates to the content based on legal, regulatory, and/or subject matter changes. Additionally, some online learning management systems have the ability to track, organize, and report trainee data, all of which are important functions for managing and demonstrating compliance with FLSA requirements.

Training should not be a one-time event. It needs to be an ongoing and continual process that is part of the organization's long-term training strategy. Employers and wage and hour specialists should reinforce the training with periodic reminders regarding compliance standards and methods. These reminders can be delivered in the form of company newsletters, meetings, refresher classes, assessments, posters, and handouts.

Documentation

The FLSA does not require that companies document FLSA compliance training for employees. However, like all other training that occurs, keeping track of who has participated in particular training programs is recommended. This documentation should include content, training dates, and attendee names. It can take the form of training program sign-in sheets, the retention of training aids and handouts, and/or signed confidentiality statements acknowledging receipt and understanding of the training. This documentation can be either in written or electronic form and should be retained for a minimum of five years. As an additional benefit, online learning management systems facilitate these types of records as they often store all of the necessary information.

Conclusion

It is critical for organizations to develop, implement, and reinforce training practices that are in compliance with the FLSA. Those who are not in compliance with the FLSA may find themselves faced with a $1,000 civil penalty and up to $10,000 and prison time for a criminal penalty.

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Categories: 2004

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