Stay compliant with the Fair Labor Standards Act

As we move into the busy winter season and focus on meeting the seasonal needs of our customers, it is essential to comply with federal labor regulations, particularly in an industry like propane, where long hours and safety considerations are critical. One of the most critical but often misunderstood is the Fair Labor Standards Act (FLSA).

The FLSA establishes standards for minimum wage, overtime pay, record-keeping and youth employment. In 2024, several significant changes have been implemented in these areas, and it is crucial to understand how these changes affect your business. Most of these regulations apply to both small and large businesses, so you are highly encouraged to consult your human resources or legal team to ensure compliance.

Understanding FLSA basics

1. Minimum wage: As of 2024, the federal minimum wage is $7.25 per hour. However, most states have implemented higher minimum wages, and some counties or municipalities have their own rates. It is vital for employers to review wage requirements in their specific locations, especially if their workforce spans multiple regions.
2. Overtime pay: The Department of Labor mandates that non-exempt employees must be paid overtime at a rate of 1.5 times their regular rate for all hours worked beyond 40 hours in a workweek. This is highly relevant in our industry, where drivers, technicians and service employees may work long shifts during peak winter demand. State laws may differ regarding overtime thresholds, so be sure to clarify with local labor laws to avoid violations.
3. Record-keeping requirements: The FLSA requires employers to maintain accurate records of employees’ hours worked, wages paid and other key employment data. Many states now require additional information on pay stubs, such as vacation balances, overtime accrual and sick time balances. Failure to comply with these requirements can result in steep penalties.
4. Youth employment: In the propane industry, the FLSA places stringent restrictions on employing people under 18. Minors are generally prohibited from performing hazardous tasks, including the handling of propane or working near potentially dangerous equipment. Ensuring compliance with these restrictions is crucial for both safety and legal purposes.

Common pitfalls and how to avoid them

• Pre-shift and post-shift work: Employees who perform work-related tasks before or after their scheduled shift, such as preparing trucks or completing end-of-day paperwork, must be compensated for that time. This often-overlooked requirement can lead to significant liabilities if ignored. Educating supervisors on the importance of tracking all work-related tasks is vital to compliance.
• Unpaid lunch breaks and work interruptions: While unpaid meal breaks are legal, employees must be fully relieved of all duties during their break. In our industry, where interruptions during lunch are common due to urgent customer calls or propane deliveries, employers must compensate an employee if their break is disrupted. Additionally, state-specific meal and rest period requirements must be followed, as non-compliance can result in costly penalties.
• Seasonal workforce management: As winter approaches, the demand for propane increases, which may require hiring temporary or seasonal workers. These employees must be treated with the same FLSA compliance standards, including proper classification, overtime pay, and training on labor laws. Misclassifying a temporary worker as exempt from overtime can result in costly legal battles, so careful review is essential.
• Payroll audits and compliance reviews: Given the complexities of FLSA compliance, particularly in industries with seasonal fluctuations and varying job roles, it’s highly recommended to conduct regular payroll audits. This ensures that hours worked are recorded correctly, pay practices are up to date and employees are properly classified. Regardless of the number of employees, employers may benefit from using time-tracking software to streamline this process and reduce errors.

In conclusion, FLSA compliance requires constant review. With long hours and seasonal fluctuations in demand, it is vital to stay informed and proactive in your approach to wage and hour laws. Regular training for managers and auditing payroll practices can mitigate risks.

Featured homepage image: iStock.com/Olivier Le Moal

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Kathy Johnson is executive vice president and chief human resource officer for EDP. With more than 20 years of HR experience, Johnson has an undergraduate degree from DePaul University and a Master’s of Jurisprudence in Employment and Labor Law from Tulane University. She can be reached at kjohnson@edplp.net or 312-254-5977.