The Importance of FLSA Compliance

The Fair Labor Standards Act (FLSA) mandates stringent requirements that employers are required to comply with. For example, the FLSA prescribes standards for wages and hours, which affect most private and public employment. It requires employers to pay covered employees (who are not otherwise exempt) at least the federal minimum wage, plus overtime pay of one-and-one-half-times the regular rate of pay.

The US Department of Labor (DoL) has significantly stepped up enforcement in tandem with a growing staff of inspectors. Consequently, a record number of lawsuits have been filed against employers alleged to have violated sections of the FLSA compliance regulations.

Compliance is a challenge

Recent surveys have shown that many companies were unwittingly violating sections of the FLSA. The DoL estimates that 7 in 10 companies do not adequately comply with wage and hour laws, and that since 2001 there has been a 400% increase in the number of wage and hour lawsuits. Violating FLSA’s employee classifications of Exempt and Non Exempt can be very expensive. Companies can incur not only negative publicity and a hit to their reputation, but also the steep cost of penalties, fines, and back wages payouts, not to mention expensive litigation and a knock to workforce morale.

Onus on employers

Among the most widespread violations pursued by the DoL are related to FLSA overtime compliance. Because of this, the law makes it mandatory for employers to maintain accurate time and payroll records. Even with such stringent regulations in place, many organizations still use obsolete and error-prone paper cards, clunky time-clocks, manual spreadsheets, and woefully inadequate record-keeping processes. These make it hard to keep an audit trail, and often result in companies failing an audit should the DoL investigate any workforce complaints.

With the steep cost of being found noncompliant, many organizations are actively promoting an internal culture of compliance by adopting Replicon for time tracking. Our cloud-based technology provides unprecedented visibility into crucial workforce data, helping over 8,000 customers effectively mitigate—and largely eliminate—the risks of non-compliance with labor laws and FLSA compliance regulations.

Replicon’s time and attendance management solutions, such as TimeAttend, have helped organizations maintain compliance by helping them:

  • Track time accurately
  • Manage and track hours, overtime, time off, meal breaks, rounding, and other attendance rules
  • Manage time records and pay data to be presented in case of an audit

For a more information on compliance, read our white papers here, and view our demo.

Fair Labor Standards Act (FLSA) Resources