Common Problems in the Retail Industry Under the Fair Labor Standards Act

 Posted on May 13,2019 in Fair Labor Standards Act

According to the Bureau of Labor Statistics, there are currently an estimated 16.6 million retail workers over the age of 16 in the United States. Jobs in the retail industry are popular among younger Americans such as high school and college students because of the flexible hours and minimum education requirements. Retail establishments can include gas stations, restaurants, department stores, and much more. Retail employees are covered by the Fair Labor Standards Act (FLSA) as long as the establishment has an annual sales volume of at least $500,000, or if employees are engaged in interstate commerce activities.

As an employer, it is important that you avoid FLSA violations to achieve full compliance.

Hours Worked Violations

Employers are required by law to pay for all hours worked by employees. Sometimes retail establishments will only allow workers to be “on the clock” if there is a need for them. If they are scheduled to work, but there is no demand for more staff, the employee will often be told they are not needed. Unless an employer immediately informs an employee of this, fully relieves them of duty, and gives them a specific time to check in, the time between their scheduled shift and the check-in time does not have to be counted as work time. If the employee is not given a specific time that is long enough to use for their own benefit, all of the waiting time should be counted as hours worked.

Illegal Deductions

It is legal for an employer to deduct the cost of uniforms, tools of the trade, merchandise, or cash shortages from an employee’s pay, to an extent. It is illegal if the deductions reduce the employee’s wages below the minimum wage or reduce the amount of overtime pay.

Salaried Employee Issues

Salary structure is only one of the factors used in determining whether an employee is subject to minimum wage and overtime guidelines. The employee’s duties and responsibilities, along with their salary, are all used to determine whether they are exempt from minimum wage and overtime. Retail employees (even salaried ones) often do not meet the requirements to be considered exempt from overtime pay.

Contact an Illinois Business Lawyer

There are a number of ways your company can mistakenly violate the FLSA, so it is important to contact a knowledgeable Schaumburg, IL FLSA labor law lawyer if you are uncertain about your compliance. At the Miller Law Firm, P.C., we are experienced in helping employers settle FLSA issues. To schedule a free consultation, call our office today at 847-995-1205.

Sources:

https://www.dol.gov/whd/regs/compliance/whdfs6.pdf

https://www.bls.gov/cps/cpsaat18b.htm