Top 3 Mistakes Employers Make with the Fair Labor Standards Act (FLSA)
Vlf Video Educational Series – Fair Labor Standards Act
Charles Vethan: Hi, I’m Charles Vethan. Welcome to the Vethan Law Firm P.C.’s Video Educational Series. Today’s topic is the US Fair Labor Standards Act or the FLSA. Specifically today’s discussion on the three or four main mistakes that employers make, when confronted with FLSA claims.
Seth Grove: Our topic today is the Fair Labor Standards Act also known as FLSA. Andrew, as you know the FLSA is the federal law that requires employers to pay their employees for overtime for any hours worked over 40 hours. Why are employers running into trouble with this federal law?
Andrew Walker: Employers are trying to do more with less. We are facing tough competition in a global company and they are trying to maximize the most human potential of every person working for them and all of the resources they have. Then we have a law from the 1930s and early 1940s that was design for a different economy at a different time.
Seth: Andrew we are seeing a spike in this litigation and I think one of the problems we are seeing is that employers aren’t aware of the, like your saying, the very strict nature of this law. For example, we have employers that aren’t paying overtime at all because they think someone is an independent contractor, instead of an employee. They think because they give them 1099 Tax Form that, that means that they don’t need to be paying overtime. However, under the FLSA the determining factor if someone’s an employee versus an independent contractor has to do with how much control an employer has over that person. If someone is coming in to work at their own pace, if someone is bringing their own materials or something like that, it maybe. However, in most cases, if you are giving them their materials, giving them a time of work and if it’s an ongoing, it’s most likely an employee and over time will be required.
Andrew: What I hear you are saying Seth is that what you call the person as an employee or as a contractor, it’s the reality of the structure of their work and what they bring to the work and how much control you have, however you measure it.