Wage and Hour Law
Definition
A set of federal and state regulations that govern how employees are paid and how their working hours are tracked and compensated.
What is Wage and Hour Law?
Wage and hour laws set legal standards for minimum wage, overtime pay, timekeeping, and child labor protections. At the federal level, the Fair Labor Standards Act (FLSA) is the primary law, enforced by the U.S. Department of Labor (DOL). Many states, cities, and municipalities impose additional or stricter wage and hour laws that employers must also follow.
Why is Wage and Hour Law Important for Employers?
Non-compliance can result in:
- Wage and hour lawsuits (including class actions)
- Fines, back pay, and penalties from the DOL or state agencies
- Reputational damage and employee dissatisfaction
To stay compliant, employers must:
- Accurately classify employees as exempt or non-exempt
- Maintain precise timekeeping and payroll records
- Pay overtime correctly
- Adhere to the highest applicable minimum wage rates
Key Topics Covered by Wage and Hour Law
- Minimum Wage: Employers must pay at least the highest applicable minimum wage (federal, state, or local).
- Overtime Pay: Typically 1.5 times the regular rate for non-exempt employees working over 40 hours in a week.
- Meal and Rest Breaks: Required by many state laws, though not federally mandated.
- Off-the-Clock Work: Employees must be compensated for all time worked even if it occurs before or after a scheduled shift.
- Timekeeping: Employers are required to keep records of hours worked and wages paid.
FAQs
What’s the difference between exempt and non-exempt employees?
Exempt employees are not entitled to overtime under the FLSA. To qualify, they must meet salary and job duty requirements.
What happens if an employee works through their break?
In most cases, if the break is unpaid and the employee works, they must be compensated.
Do remote employees count for wage and hour laws?
Yes. Employers must comply with wage and hour laws in the employee’s state, not just where the company is based.
How ExtensisHR Can Help
We take the guesswork out of compliance with wage and hour laws by:
- Accurately classifying exempt vs. non-exempt roles
- Offering access to compliant time-tracking systems
- Managing overtime calculations and minimum wage changes across states
- Supporting DOL audits and wage dispute resolution
- Keeping you updated on state-specific rules and changes