As a small business owner, you wear many hats. One important role is being a fair employer. The Fair Labor Standards Act (FLSA) is a federal law that sets rules for wages, overtime, and child labor. Knowing and following these rules can help you run your business smoothly and avoid penalties.

What is the FLSA?

The FLSA is a law passed in 1938 to protect workers in the United States. It sets the minimum wage, requires overtime pay for certain workers, and sets rules for hiring minors. The law applies to businesses of all sizes, including those with fewer than 49 employees.

Key Requirements of the FLSA

1. Minimum Wage

• Federal Minimum Wage: The federal minimum wage is $7.25 per hour.
• State Minimum Wage: Some states have a higher minimum wage. You must pay the higher rate if your state requires it.
• Tipped Employees: If your employees earn tips, different rules apply. You can pay a lower hourly wage, but their total earnings with tips must equal at least the federal minimum wage.

2. Overtime Pay

• Who Gets Overtime: Employees who work more than 40 hours in a workweek must receive overtime pay.
• Overtime Rate: Overtime pay is 1.5 times the regular hourly rate.
• Exempt Employees: Some workers, like certain managers and professionals, may be exempt from overtime rules.

3. Recordkeeping

• Keep Accurate Records: You must keep records of employee wages, hours worked, and other details.
• What to Record: Include employee names, addresses, hours worked each day, total hours each week, and pay rates.
• How Long to Keep Records: Keep these records for at least three years.

4. Child Labor Laws

• Age Restrictions: There are limits on the types of jobs and hours that minors can work.
• Under 14 Years Old: Generally cannot be employed, with some exceptions.
• Ages 14-15: Limited to non-hazardous jobs and restricted hours.
• Ages 16-17: Can work more hours but still cannot do hazardous work.

Why Compliance Matters

• Avoid Penalties: Violating the FLSA can result in fines, back wages, and legal fees.
• Employee Morale: Fair treatment leads to happier employees and better productivity.
• Reputation: Compliance helps maintain a good reputation with customers and the community.

How to Stay Compliant

• Review the Laws: Familiarize yourself with federal and state labor laws.
• Train Management: Ensure that anyone in a supervisory role understands the FLSA requirements.
• Use Professionals: Consider hiring an HR professional.
• Use Timekeeping Systems: Implement reliable methods to track employee hours accurately.

Conclusion

Understanding and following the FLSA is essential for your small business. It helps you treat your employees fairly and protects your business from legal issues. By staying informed and proactive, you can create a positive work environment and focus on growing your business.

HR isn’t just for big companies. It’s a key part of success for small businesses too. From making sure the company follows the law to helping employees feel valued, HR helps small businesses build strong teams, avoid problems, and grow.

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Check out our website: www.CavnessHR.com

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