How to Calculate Regular Work Hours Under FLSA?
Probably the most important thing regulated by FLSA is how employers should calculate their employees' work hours.
To accurately calculate and round up work hours without violating the FLSA laws, all employers have to apply the 7-minute rule.
This means work start and stop times must be rounded up or down to the nearest quarter hour:
- If an employee starts working at 08:07, the work time should be rounded down to 08:00.
- If an employee starts working at 08:08, the work time should be rounded up to 08:15.
Under FLSA, work hours are defined as compensable time where the employee is “required to be on the employer's premises, on duty, or at a prescribed workplace.”
Calculating work hours is solely the employer's responsibility, not the employee’s. Any mishaps or failures in that department can open up organizations to disputes, lawsuits, and different types of penalties, as stated by both federal and state laws.
To avoid these potential problems and further simplify the entire calculation process, US employers have started using specially designed software.
Time-tracking software greatly reduces the chance of errors when calculating work hours. This helps employers follow federal laws and guarantees all employees get paid correctly for their time.
How to Calculate Overtime Under FLSA Timekeeping Requirements?
All employers should know the correct process of calculating overtime hours.
The formula is as follows:
- 1.5 x regular hourly pay = hourly overtime rate
Note: Employers may pay overtime at a rate higher than 1.5 x regular hourly pay, but never less than that.
Calculating overtime accurately forms a large part of the labor laws covered by the FLSA. Not doing so can lead to different penalties, punishments, and civil lawsuits.
While overtime calculations aren't overly complicated, doing them manually can work for small teams but is more error-prone for larger teams.
So, to avoid hefty lawyer fees, penalties, and, in the worst cases, jail time, having a reliable system for overtime calculations is the safest option. This is why many organizations today rely on dedicated time-tracking software.
These tools automatically track and record overtime hours, keeping you in full compliance with labor laws.
How to Accurately Track Regular Work Hours Under FLSA?
FLSA doesn’t specify how employees should track work hours, but it does state that work hours must be accurately recorded.
Within a single workweek, the maximum amount of regular work hours cannot exceed 40:
- If the work hours tracked in a single week are equal to or less than 40, the employee is entitled to regular pay, which cannot be lower than the federal minimum wage ($7.25 per FLSA).
- Any hours tracked over 40 in a single workweek must be recorded as overtime (see below).
Regular work hours, or “straight time,” are terms defined by the FLSA Act. Under this Act, the federal government defines a “workweek” as 168 hours, or seven consecutive 24-hour intervals.
Therefore, a workweek does not have to align with the calendar week. It can begin on any day (including weekends) and at any hour.
It is not permitted to average work hours over multiple weeks. Each workweek stands alone, and hours must be accurately recorded within each period.
Accurately tracking employee hours and paying every worker according to the number of hours they’ve put in is important for any successful business.
Again, many organizations rely on time-tracking software to lower the chances of human error or negligence in tracking regular hours.
How to Accurately Track Overtime Hours Under FLSA?
The FLSA states that overtime hours are considered any hours tracked over the regular 40-hour threshold in a single workweek.
For example, if an employee tracks 45 hours in a workweek, the first 40 are considered regular hours and the remaining five are counted as overtime.
The FLSA does not impose rules on daily overtime (working for more than a set number of hours per day). Some state laws do mandate daily overtime, but these rules are separate from FLSA requirements.
There are also no specific restrictions or methods that the FLSA requires for tracking overtime hours. Employers can track overtime in a manner of their choosing, and many turn to time-tracking software as one of the best and easiest methods.
How Does Tracking Time Off and Breaks Work Under FLSA?
The FLSA does not require employers to provide meal breaks, rest breaks, or paid time off (PTO).
But if offered, employers must follow specific rules around tracking and compensation.
Paid and Unpaid Time Off Tracking Under FLSA
Unpaid time off does not have to be tracked, but PTO must be tracked for accurate recordkeeping and payroll processing.
However, regular wages and overtime pay are calculated based on hours worked, not hours paid. This means that any PTO taken in a single workweek does not count toward the 40-hour threshold.
For example, if an employee works 35 hours and takes 10 hours of PTO, they get paid for 45 hours total but are not eligible for overtime pay.
Breaks and Meal Period Tracking Under FLSA
If the employer offers breaks and meal periods, there are specific rules on how they are tracked and paid:
- Short breaks of 5 - 20 minutes must be tracked and counted as hours worked and paid accordingly.
- Meal periods lasting 30 minutes or longer can be unpaid as long as the employee is relieved from all work duties for the duration.
- If an employee is expected to perform any type of work during a meal period, it must be tracked and compensated.
How to Account for Travel Time Under FLSA?
To determine if travel time can be considered as working hours under FLSA, employers should be mindful of the following:
- It’s not considered compensable travel time when a worker commutes from home to their place of employment.
- It is considered compensable travel time if a worker must travel from one job site to another.
If travel time is compensable, employers must track and record it as either straight work hours (regular work hours) or overtime (as per the rules noted above) and be compensated accordingly.
To help you calculate regular and overtime work hours, you can use the My Hours free time card calculator.
What Are the FLSA Recordkeeping Requirements?
FLSA recordkeeping requirements demand that employers accurately record and maintain certain information for non-exempt employees. However, it does not mandate a specific method for recordkeeping.
Employers must record the following information for each employee:
- Full name and social security number
- Address of residence with a unique zip code
- Date of birth (if an employee is younger than 19 years of age)
- Their gender
- Occupation within the company of employment (line of work)
- The exact time when the workweek begins
- The type of payment they receive (hourly, weekly, or on a per-project basis)
- Regular pay rate per hour of work
- The total number of regular hours worked each day and each week
- The total number of overtime hours worked each day and each week
- Date of each pay period and the amount an employee has received for said pay period
The primary reason for keeping accurate employee records, beyond meeting federal labor law requirements, is accurate payroll management.
Reliable payroll expense tracking helps employers run their business more efficiently and provides valuable insights for identifying cost-saving opportunities, without harming overall business operations.
How to Store Employee Records Under FLSA?
As per FLSA regulations, employee records need to be:
- Easily accessible for inspection by authorized government personnel.
- Easily transferable into a format chosen by the government inspector (meaning, if the records are digital, employers should be able to easily transfer them into physical copies or vice versa).
- Kept safe and stored either on business premises or at a location dedicated to recordkeeping (such as a central records office).
Without an efficient system in place, storing and maintaining employee records becomes a burden for organizations of all sizes.
With My Hours, all timesheets are fully compliant with FLSA recordkeeping requirements.
Additionally, businesses can quickly generate reports ready to present during an audit. A full audit log report is also available, which helps organizations keep their books in order and always be ready for those “pesky” government inspectors.
How Long to Keep Payroll Records Under FLSA?
FLSA recordkeeping requirements state that employee information must be kept for a minimum period:
- Payroll records, including timesheets, pay rates, schedules, and hours worked, must be kept for at least three years.
- Supporting documents used for wage calculations, like job descriptions and performance reviews, must be kept for at least two years.
Again, the best way to stay compliant is to use a time-tracking software.
Conclusion
The Federal Labor Standards Act is a great addition to the United States Code that continues to protect workers' rights across the country.
While compliance with FLSA timekeeping requirements may not be overly complex, it remains vital for keeping employees happy and avoiding costly fees, penalties, or potential lawsuits.
FLSA Timekeeping Requirements: Frequently Asked Questions
What is the role of state laws vs. FLSA timekeeping requirements?
Some states have stricter time-tracking and wage laws than the FLSA.
If this is the case, employers must comply with whichever law is more beneficial or protective for employees.
How does the FLSA treat time used for training and meeting purposes?
Under the FLSA, time spent in training programs and meetings is considered compensable work time, meaning employees must be paid for it.
However, there are instances where training or meeting time is uncompensable, but only if the following four criteria are fully met:
- Attendance is outside regular working hours
- Attendance is fully voluntary
- The program does not relate directly to the employee's job
- The employee does not undertake any productive work throughout the session
Do FLSA timesheet requirements apply to remote or hybrid workers?
Yes, FLSA timesheet and recordkeeping requirements apply equally to remote and hybrid workers as they do to on-premises workers.
