The U.S. Department of Labor (DOL) announced that it has issued four new opinion letters. DOL opinion letters are designed to interpret and provide clarity to federal labor laws, and these four new letters target issues under the Fair Labor Standards Act (FLSA).
The FLSA provides a partial exemption to the overtime pay requirement of Section 7(a) for employees of public agencies engaged in protection activities. This DOL letter explains that the key factors in determining whether a private party could be considered a public agency are whether the entity is directly responsible to public officials or to the general public and whether the parties’ contracts designate them as state agencies rather than independent contractors. The letter goes on to apply the analysis to a firefighters’ association.
The FLSA’s minimum wage and overtime requirements do not apply to certain seasonal amusement or recreational establishments. An employer qualifies for this exemption if it is an “establishment,” “frequented by the public,” and “for its amusement or recreation.” This letter applies the law to a company that operates and maintains swimming pool facilities at hotels, motels, apartments, and condominium buildings.
The FLSA allows for certain “tipped employees” to be paid a reduced minimum wage by employers and to take a “tip credit.” In 2009, the Wage and Hour Division issued an opinion letter on this topic that was rescinded for further consideration on March 2, 2009. The DOL has now reinstituted that letter. Specifically, the letter defines what is permitted when employees engage in both tip generating duties and non-tip generating duties.
The FLSA exempts from its minimum wage and overtime requirements any employee that meets both the “duties” and “salary” test. Salaried employees may receive additional compensation beyond their guaranteed weekly salary without losing their exemption if a reasonable relationship exists between the guaranteed amount and the amount actually earned. This letter analyzed whether certain engineers and designers that actually earned almost double their guaranteed salary under the above mentioned scheme still qualified for the exemption.