Overtime & Fair Labor Standards Act Revised December 2, 2009

2 What is FLSA? Federal law passed in 1938 Enforced by U. S. Department of Labor (DOL) Public employers became covered in 1986 Updated August 23, 2004

3 Establishes minimum wage and overtime standards Distinguishes between covered (non-exempt) and excluded (exempt) employees Establishes overtime threshold (40 hr.) Specifies record-keeping requirements Purpose of FLSA

4 What does FLSA cover? Overtime Minimum Wage –$7.25 federal minimum rate became effective July 24, 2009 –$8.25 is VCU’s minimum for classified and hourly employees Child Labor Equal Pay Recordkeeping

5 Types of FLSA Exemption Status Exempt – not covered by FLSA (overtime pay not required) Non-Exempt – covered under FLSA for time-and- one-half overtime pay

6 Job Basis test: Must meet Executive, Administrative, Professional, or Computer Professional test for exemption. –Applies to each position individually based on duties and responsibilities - not to a class, Role, working title, or category of position. Salary Basis test: Salary more than $455 per week, regardless of whether part-time or full-time – does not apply to teachers, employees practicing law or medicine, and outside sales employees. Exempt Positions under FLSA

7 How do you know FLSA status of classified positions? EClass designates FLSA status. HR Generalist (HRG) notifies department Personnel Administrator (PA). PA can access FLSA status: –EClass in PEAEMPL or NBAJOBS in Banner –In NBAPOSN: a checkmark beside “Exempt Indicator” = exempt FLSA status; no checkmark = non-exempt status. Employees should see their supervisor or PA.

8 Exempt (C2, C4, C6, some LE) –In pay bands 4 and above, if job duties and salary basis exemption tests are met. –FLSA exemption status determined by HRG. Non-Exempt (C1, C3, C5, some LE) –All in pay bands 3 and below. –In pay bands 4 and above, if job duties and salary basis exemption tests are not met. –FLSA exemption status determined by HRG. Classified (C1, C2, C3, C4, C5, C6, and LE)

9 All faculty positions must be Exempt. FLSA exemption status determined by Provost or VPHS offices. F1 – F6 and M1 – M6: Always exempt if teaching or practicing medicine; otherwise, job duties and salary basis exemption tests must be met. A1 – A6, P1 – P6, and O1 – O6: Job duties and salary basis exemption tests must be met. If job duties or salary basis exemption tests are not met, these positions cannot be faculty. Faculty (F1 – F6, A1 – A6, P1 – P6, M1 – M6, and O1 – O6)

10 All adjunct faculty positions must be Exempt. If primary job is non-exempt, overload job cannot be adjunct - must be treated as hourly. Contact your HRG for more information. Adjunct Faculty (AJ)

11 AJ001 Adj Fac Credit Instructor, Pos #J00001 AJ003 Continuing Education Instructor, Pos #J00003 AJ004 Adj Faculty-Summer Only, Pos #J00004 AJ005 Elderhostel Adjunct Instructor, Pos #J00005 AJ006 Adj Fac Non-Credit Instructor, Pos #J00006 FLSA exemption status determined by Provost or VPHS offices. Under FLSA, teaching as primary duty is always considered exempt. Adjunct Faculty (AJ) Who Teach

12 AJ002 Adjunct Faculty Non-Teaching, Pos #J00002 FLSA exemption status determined by Provost or VPHS offices. Both job duties and salary basis exemption tests must be met. Must make at least $455 per week, unless teaching, practicing law or medicine, or outside sales. If job duties or salary basis exemption tests are not met, these positions cannot be adjunct faculty. Contact your HRG for more information. Adjunct Faculty (AJ) Who Don’t Teach

13 Graduate Assistants and Post-Doctoral Scholars are considered Exempt under FLSA. Graduate Assistants (GA and G9) & Post-Doctoral Scholars (PD)

14 All hourly employees (except teachers or those practicing medicine) are considered Non-Exempt under FLSA. Hourly (H1), Student Workers (SW), Work-Study (WS)

15 Paid for job, not hours worked. No overtime payments required. In extremely rare situations, may provide: –Compensatory time or straight-time pay for hours worked >40 hours in a workweek. –Should be for short duration of time under special circumstances (vacancy, special project, etc.). Exempt Employees

16 Must receive 1 1/2 times regular rate for all hours worked in excess of 40 in a workweek or overtime leave. –Time-and-One-Half Overtime –Overtime Leave If leave was taken during week, non-exempt employee receives regular rate (straight time, 1 hour = 1 hour’s pay) for hours worked in excess of scheduled hours up to 40 during a workweek. –Straight Time Overtime Non-Exempt Employees – Overtime Compensation

17 Non-Exempt Critical Term: “Hours Worked” Principal job activity “Suffer” or permit to work Rest periods less than 20 minutes in duration (except lunch)

18 Non-Exempt Critical Term: “Workweek” Workweek begins at 12:01 a.m. on Sunday and ends at 12:00 a.m. (midnight) on Saturday 168 consecutive hours during a 7-day period

19 Non-Exempt Critical Term: “Regular Rate” Includes all forms of remuneration (e.g., shift differential, on-call pay, lump-sum payments, second job salary) Converted to HOURLY rate Particular to each workweek

20 Perform principal duties Perform principal duties or closely-related duties outside of work hours Travel time between job sites Employer-required training Breaks (<20 minutes) Pre- and postliminary activities (checking job locations, fueling cars, picking up mail at P.O., putting away tools at end of day) Non-Exempt Compensable Time Examples

21 Preparatory work related to principal duties “Waiting” or “standing by” for work “Unauthorized” work performed (with or without supervisor’s knowledge) Arrives early to work and begins working Meal time - if employee is not “free” from work duties Non-Exempt Compensable Time Examples

22 Work not requested but “suffered or permitted” is counted as time worked Standard is whether employer knows or has reason to believe the work is being performed Non-Exempt Compensable Time Examples – Unauthorized Work

23 Overload Jobs If primary job is part time, department must consult with HRG. PRIMARY JOB OVERLOAD JOB OVERTIME PAYMENT? EXEMPT NO EXEMPTNON-EXEMPTNO NON-EXEMPTEXEMPTYES NON-EXEMPT YES

24 U.S. Department of Labor (DOL) enforces FLSA Burden of proof is on employer If violation found to be willful, employee can sue employer for recovery of back wages and liquidated damages for up to 3 years Employer cannot retaliate against employee for “whistle blowing” FLSA Violations

25 Potential DOL Penalties Unpaid wages (2 - 3 years of back wages) Fines ($10,000) Imprisonment (6 months) Liquidated damages (2x) Attorney fees and costs Individual liability

26 Banner Overtime Authorizations Exception OT1 Additional Paid 1.0 OT2 Additional Paid 1.5 Exception OT1 Additional Paid 1.0 OT2 Additional Paid 1.5 FLSA STATUS EXEMPT FLSA STATUS EXEMPT OT2 Overtime 1.5 OT1 Additional Paid 1.0 OT2 Overtime 1.5 OT1 Additional Paid 1.0 FLSA STATUS NON-EXEMPT FLSA STATUS NON-EXEMPT

27 For more information… Contact your HR Generalist Review “Overtime Guidelines” and related links on the VCU HR Compensation Management webpage at See “VCU Banner Leave Reporting and Timekeeping Manual” at keeping_Manual.pdf keeping_Manual.pdf