Being fired is not the only way in which a current employee may be dismissed. An employment termination agreement is a way of ending a working relationship with someone without having to fire them which can make it difficult for them to find a job afterwards. What is important and what should be considered?
No matter how large your company is, there are state rules that employers have to follow to make sure their employees are being properly taken care of. Any employers that don’t adhere to these rules could find themselves with a fine or even jail time. To avoid this, make sure you comply with the federal Fair Labor Standards Act (FLSA).
What is the Fair Labor Standards Act?
The FLSA, enacted in 1938, is an act that applies to all employers and sets out provisions for minimum wage, working hours, overtime, exempt and non-exempt employee classification, and child labor. The FLSA regulates how employers should compensate their employees, but doesn’t regulate the maximum number of hours an employee can work per day or week, unless the employee is under 16 years of age. The employer can decide how many hours an employee over 16 can work. According to the Bureau of Labor Statistics, Americans work on average 34.5 hours per week (correct as of July 2018).
Who is covered by the FLSA?
Employees in the following industries are covered by the FLSA:
- Interstate commerce
- Schools for mentally ill, disabled, or gifted children
- Preschools/elementary schools/secondary schools
- Higher education institutions
- Institutions caring for the sick, elderly, disables, or mentally ill
- Federal, state, and local government agencies
- Day workers
- Full-time babysitters
The FLSA states that any work over 40 hours in a 168-hour period is counted as overtime. Since there are no regulations in place for the maximum number of hours that can be worked, as is the case in many other countries, the 40-hour week often gets exceeded as employees strive to do their best, often staying hours after their usual “clocking off” time. Although there are no standards to regulate these extra hours, they can take their toll on the health, safety, and productivity of an employee, especially over a prolonged period of time.
According to the FLSA, overtime must be paid in both the private and the public sector. The employer should pay time and a half for any hours worked after the usual forty. The FLSA doesn’t cover double time; the employer and employee should sort that out between themselves.
In addition to what the Fair Labor Standards Act has laid out, certain states have come up with their own regulations and laws. The states that require employees to be paid overtime if they work more than 40 hours a week or 8 hours a day are: Alaska, Arkansas, Connecticut, Hawaii, Illinois, Indiana, Maine, Maryland, Massachusetts, Michigan, Missouri, Montana, Nebraska, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oregon, Pennsylvania, Vermont, Washington, and Wisconsin. The exceptions include:
- California: complies with federal law, but also requires employees to receive time and a half for the first eight hours in the seventh day of a work week.
- Colorado: overtime to be paid if an employee works more than 12 hours in a day.
- Kentucky: complies with federal law but requires an employee to receive overtime pay if they have worked seven days in one week (with the overtime pay being received on the seventh day).
- Minnesota: requires overtime pay for over 48 hours worked per week
- Rhode Island: requires retail employees to be paid overtime for working Sundays and holidays.
The minimum wage can also differ between states. Federal law states that $7.25 must be paid as the minimum (or $455 weekly for salaried employees), but some states have taken it upon themselves to increase the minimum wage to compensate the rising costs of living, therefore employers must comply with this. These states are Alaska, California, and Connecticut.
Night shift work
According to the Bureau of Labor Statistics, 3 million Americans work night shifts. Although the Fair Labor Standards Act doesn’t require employers to pay employees extra if they work the night shift or weekend shift, some employers do offer more money to make these shifts seem more appealing. These shifts aren’t usually too popular since they disrupt the body’s natural sleep cycle and can lead to stress and fatigue. Although they aren’t mandatory, the Federal government offers its own guidelines on what employers could pay their employees that work at night:
- If the employee works the majority of their hours between 3pm and midnight, they should be entitled to a 7.5% pay increase.
- If the employee works the majority of their hours between 11pm and 8am, they should be entitled to a 10% pay increase.
Some professions (e.g. doctor, IT technician) require employees to be on call, meaning they have to be ready to work at the drop of a hat. Again, the FLSA decides the rules on whether the employee will be paid or not when they are on call. It all depends on whether the time spent on call qualifies as “hours worked”. If the employee is in an actual office or workplace, they must be paid since they can’t spend their time doing personal tasks there. An example would be hospital staff who have to stay in the hospital building while being on call.
Some employers require their employees to be on call for more than 24 hours at a time, but an employer has the right to decrease the employee’s pay for the hours they spend sleeping. Qualifying sleep periods must be more than five hours, but no more than eight hours. A furnished sleeping facility also needs to be available to the employee.
Employees also need to be compensated if they are at home, but the amount of calls they receive stops them from doing their own thing e.g. tidying the house or going grocery shopping.
Here, too, many states have regulations that differ from those of the Federal government. Employers must follow whichever is the most beneficial to the employee.
Please note the legal disclaimer relating to this article.