Fair Labor Standards Act of 1938

1718 Words Dec 10th, 2010 7 Pages
Fair Labor Standards Act of 1938 – as Amended

As the United States endured the hardships of the Great Depression, the struggles of the working class grew and employers were able to take advantage of desperate workers by overloading hours and shrinking wages. In 1938, President Franklin Roosevelt, in his New Deal legislation, saw the opportunity to attend to the issues concerning workers involved in interstate commerce. The Fair Labor Standards Act was passed, and the President described it in the following way “Except for the Social Security Act, it (the FLSA) is the most far-reaching, far-sighted program for the benefit of workers ever adopted here or in any other country.” (Nordlund). The FLSA, as it is known, set a maximum number of
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Housing Authority. In 1938, The Fair Labor Standards Act became the last piece of New Deal legislation passed. The Fair Labor Standards Act has been amended many times and is virtually an ever-changing law, however, it does not cover all employees. There are several classes of “exempt” employees, including salaried employees in the executive/managerial, administrative, and professional areas. Outside salespeople are also considered exempt. One of the issues facing companies today is knowing which employees are exempt and which are non-exempt. There are tests to determine if an employee is exempt. In 2004 the tests changed to a standard test, which is whether or not the employee’s salary is $455/week or greater and the duties test, which allows for exempt status if more than 50% of the work performed by an individual is “exempt work.” (Pass and Broadwater) Exempt employees do not receive overtime pay, which can be a substantial cost savings to a company. My previous employer required that an exempt manager close the center each night even though we had non-exempt team leads who acted as managers in most capacities. The reason was to avoid overtime costs. An ongoing issue regarding FLSA impacts to companies is the issue of what is called the Portal to Portal Act (PPA), passed in 1947. The question that this relates to is when does the work day start and
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