Ch6. FLSA Deep Dive — Working Conditions, Termination, and Hours

Employment Contract and Working Conditions

Employment Agreement:
Written notice obligations (wages, hours, leave, work location)
Some states require written offer letter or wage notice
Violation: civil penalty or private right of action

Working Conditions Standards:
Federal floor (FLSA, FMLA, ADA, Title VII) — employers may only exceed, not fall below
Employee handbook / work rules: cannot reduce statutory minimums
CBA: supersedes handbook (union employees)

Minimum Wage:
Federal: $7.25/hr (many states/cities higher)
Annual determination by DOL for federal contractors
Violation: FLSA civil penalty + back pay + liquidated damages

Termination

Lawful Termination (At-Will Default):
Most US employees are at-will — termination for any lawful reason
Exceptions: discrimination, retaliation, public policy, implied contract

Wrongful Termination:
No written WARN Act notice (60 days for 100+ employees)
Discriminatory termination (Title VII, ADA, ADEA, GINA)
Retaliatory termination (FLSA, FMLA, NLRA, OSHA)

Mass Layoff / RIF (WARN Act):
Urgent business necessity
Good-faith efforts to reduce workforce through other means
Objective selection criteria
60-day written notice to employees, state, and local government

Written Notice:
Recommended best practice; required under WARN Act for mass layoffs
Oral-only termination creates documentation risk

Working Hours

Standard Workweek:
8 hours/day, 40 hours/week (FLSA threshold)

Overtime:
Over 40 hours/week: 1.5× regular rate
(Daily overtime in California: over 8 hrs/day)

Night and Weekend Premium Pay:
No federal mandate; required by some state laws or CBAs
Common practice: additional pay for evening/holiday shifts

Flexible Work Arrangements:
Compressed workweek (e.g., 4×10 schedule)
Flexible scheduling within the workweek

Rest Periods:
Federal: no mandate; many states require 10-min break per 4 hrs
Meal period: states commonly require 30-min unpaid break for 6+ hrs

Wages and Retirement Benefits

Wage Payment:
Direct, monetary, full, and regular payment
Most states require semi-monthly or bi-weekly payment

Regular Rate of Pay:
Used for FLSA overtime calculation
Includes all remuneration except specific exclusions
(gifts, discretionary bonuses, expense reimbursements excluded)

Average Earnings:
Back-pay calculations based on prior earnings
Workers' comp: typically based on average weekly wage

Retirement Benefits:
ERISA-governed defined benefit and defined contribution plans
Vesting schedules: 3-year cliff or 6-year graded (most plans)

Key Concept Cards

Termination Notice = 60-Day WARN ★★★★★ : Employers with 100+ employees must give 60-day notice before mass layoffs. Memory hook: WARN = 60 days

Wrongful Termination Claim = 180/300 Days (EEOC) ★★★★★ : EEOC charge must be filed within 180 days (300 in deferral states) of the adverse action. Memory hook: EEOC = 180/300 days

Overtime Threshold = 40 Hours/Week ★★★★☆ : Federal FLSA: overtime kicks in above 40 hours; California adds daily 8-hour threshold. Memory hook: OT = 40 hrs

Practice Quiz

Q. If a mass layoff (RIF) fails to meet one of the four WARN Act requirements, what is the effect?

A WARN Act violation exposes the employer to: back pay and benefits for each day of the violation (up to 60 days), civil penalty of up to $500/day, and attorney’s fees. The layoff itself is not invalidated, but each affected employee can sue. The four requirements are: (1) employer size threshold (100+ employees), (2) size of layoff (50+ at a single site), (3) 60-day advance written notice, (4) notice delivered to employees, state, and local government. Missing any one triggers liability.

Q. What is the difference between the regular rate of pay and average weekly earnings?

Regular rate: all remuneration paid per workweek divided by hours worked; used as the FLSA overtime base. It must include non-discretionary bonuses, shift differentials, and commissions. Average weekly earnings (or average weekly wage): used for workers’ comp benefit calculations; typically a trailing 52-week average of gross wages. If the regular rate falls below minimum wage, minimum wage governs. For workers’ comp, a higher prior average wage generally means a higher TTD benefit.