Understanding Federal Timekeeping Laws: The FLSA Foundation
The Federal Labor Standards Act (FLSA) is the cornerstone of U.S. wage and hour laws, ensuring employees receive fair compensation. Under FLSA, employers must pay overtime at 1.5 times the regular rate for hours worked over 40 in a week. This law applies to a workweek, defined as a fixed 168-hour period. Accurate record-keeping is also mandated, with employers required to maintain detailed records such as hours worked and wages paid, for at least two years. For payroll, records must be kept for three years, aligning with federal retention guidelines.
Time rounding under FLSA is permissible, allowing employers to round to the nearest 5, 10, or 15 minutes, provided it averages out fairly. The common "7-minute rule" means rounding down if within the first 7 minutes of an interval and rounding up if within the last 7 minutes. These regulations underscore the importance of accurate time tracking and compliance to avoid costly penalties from non-compliance.