Fundamentals of Wage and Hour Law in Utah
| Publication year | 1997 |
| Pages | 17 |
| Citation | Vol. 10 No. 1 Pg. 17 |
Brian C. Johnson and Gayanne K. Schmid, J.
INTRODUCTION
Utah law governing wage and hour issues in employment is largely derived from the federal Fair Labor Standards Act of 1938, 29 U.S.C. § 201 et seq. ("FLSA"). The FLSA establishes standards and requirements in several areas including wages, hours, and child labor. The FLSA is supplemented in certain areas by Utah law. This article provides the Utah general practitioner with an overview of the FLSA and certain state laws that govern the employer-employee relationship.
FLSA COVERAGE
The FLSA is pervasive in its coverage. Its provisions regulate all employment relationships affecting interstate commerce. "Employ" means simply "permitting an individual to work." FLSA § 203 (g). An employer only need have knowledge of work by another with an expectation of payment to be covered by the FLSA. No contract of work is required. The interstate commerce requirement imposed by the FLSA is modest and nearly always met. An employer is covered when its annual gross sales are not less than $500,000, and two or more of its employees are engaged in (1) interstate commerce on a regular basis, however slight; (2) production of goods destined for interstate commerce; or (3) working on goods originating out of the State of Utah. See FLSA § 203 (s) (1).
Hospitals, nursing homes and schools are specifically covered by the FLSA. FLSA § 203 (s) (1) (b). Public agencies are also generally covered. FLSA § 203 (s) (a) (c). Significantly, where an employee is engaged in work covered by the FLSA and work not covered by the FLSA during the same work week, the FLSA's provisions are applicable to that employee for the entire week because statutory protections are based on the work week and not on the work day.
Important exceptions to the FLSA's broad coverage exist. For instance, family businesses are not covered by the FLSA where the only regular employees of the business are members of the owners' immediate family. FLSA § 203 (s) (2). Additionally, employees of legislative branches of state and local governments which are not subject to public employer's civil service laws are not covered by the FLSA. FLSA § 203 (e) (2) (c). Elected public officials and their appointed personal staff members are also not covered by the FLSA. Id. Most importantly, for the general practitioner, certain employees otherwise subjected to the coverage of the FLSA are exempt therefrom based on the quality or type of work they perform.
Whether an employee or group of employees may be classified as exempt, and therefore not subject to the FLSA's minimum wage and overtime requirements, presents one of the most difficult problems for employers. The standards applied to measure the availability of an exemption are far more rigorous and demanding that most employers and lawyers realize. Job titles, for example, are probably the least determinative factor. Many employers simply rely on the payroll practices of the past and do not take the time to conduct the analysis that would have revealed proper classifications. They are then painfully surprised to learn they are responsible for paying back overtime wages to employees that should have been classified as "non-exempt".
The FLSA has recognized certain established groups of employees as being exempt. The principal exempt classifications include: (1) professional employees, such as pilots, accountants, doctors, etc.; (2) administrative employees, such as personnel directors, and executive secretaries; (3) executive employees who are decision makers for a business enterprise; (4) true outside salespersons who spend the majority of their time selling products or services; (5) employees at seasonal amusement or recreational establishments, organized camps and religious or non-profit educational centers; (6) agricultural employees, such as farmers; (7) babysitters and companions for the aged or infirm; (8) taxicab drivers; (9) domestic employees who work and reside in a household; (10) motion picture theater employees; (11) employees of retail or service establishments who receive most of their compensation and commissions, and whose regular rates of pay exceed one-and-one-half times the minimum wage.
Employees who are properly classified as exempt must satisfy a two-prong test. First, they must fall within one of the categories generally described above. Second, they must receive a certain level of remuneration for their efforts. As to this latter requirement, the employee must be paid on a salaried basis. The idea is that the individual is compensated based on the overall value of the services rendered and not on the length of time it takes to perform the services. Thus, an employer jeopardizes the employee's exempt status if it deducts from an exempt employee's pay partial absences during the day and/or for unsatisfactory or insufficient work. Of course, an employer is not required to pay an exempt employee for a work week in which he or she performs no work or for days where that employee is absent for personal reasons other than illness or accident. The general idea though is that a salaried employee is required to work until his or her job is completed and do not have to account for time spent doing so.
To be classified as an exempt employee, the salary paid must be a minimum amount which varies according to the employee's job duties. For example, to satisfy the current requirements for an executive or administrative exemption under the streamlined test, an employee must receive at least $250 a week on a salary basis. Employees who make less than $250 a week but more than $155 per week may still qualify under the executive or administrative...
To continue reading
Request your trial