Law, Business and Society 11th Edition by Tony McAdams

Exercise 1

A note was passed to President Franklin D. Roosevelt in 1936 from a young girl:
I wish you could do something to help us girls. We have been working in a sewing factory … getting our minimum pay of $11 a week. Today, the 200 of us girls have been cut down to $4 and $5 and $6 a week.
Roosevelt reportedly remarked that something needed to be done about child labor. The Depression and its tragic suffering, even of those working hard, shattered many Americans' faith in the free market and led to government intervention including, in 1938, the Fair Labor Standards Act (FLSA), which is directed toward these major objectives:
1. The establishment of a minimum wage that provides at least the foundation for a modest standard of living for employees.
2. A flexible ceiling on hours worked weekly, the purpose of which is to increase the number of employed Americans.
3. Child labor protection.
4. Equal pay for equal work regardless of gender. (See Chapter 13.)
[For the U.S. Department of Labor home page, see www.dol.gov ]
Minimum Wage In 2009, the federal minimum wage was increased to $7.25 per hour. Critics of a federally mandated minimum wage argue that the government should not interfere in the marketplace, and that increases in minimum wages threaten not only job growth but the livelihoods of many small business owners. Supporters of minimum wage increases point to recent studies concluding that raising the minimum wage does not lead to the loss of low-paying jobs. More than 130 municipalities, many where living costs are particularly high, have adopted their own "living wage" requirements. For example, San Francisco, known for its high cost of living, at this writing has a minimum wage of $10.74. However, as a 2014 study by the National Low Income Housing Coalition shows, minimum-wage workers across the United States cannot afford a one- or two- bedroom apartment at fair market rent. [For state minimum wage laws, see www.dol.gov/whd/minwage/america.htm ]
Overtime Most workers covered under FLSA must receive overtime pay of at least Wi times their regular pay rate for hours worked over 40 hours per week. However, FLSA also recognizes exemptions for certain occupations, such as managers, outside salespersons, administrators, and professionals with advanced degrees; these workers are referred to as "exempt" employees. Misclassification of "nonexempt" employees who have overtime rights under FLSA is a common basis for wage-and-hour claims against employers, which have led to high-profile settlements. In 2013, Walmart vision center managers and asset-protection coordinators who were once considered exempt but then reclassified as nonexempt received $4.8 million in back wages and damages. In 2011, Lévi-Strauss was ordered to pay over $1 million in overtime back wages to misclassified workers, including employees who held the title of assistant store manager but were incorrectly treated as exempt, given the actual nature of their work. However, the U.S. Supreme Court in 2012 ruled in Christopher v. Smith-Kline Beecham Corp. that pharmaceutical sales representatives were not entitled to overtime pay.
Overtime claims often involve disputes over whether the employee was actually working, rather than being engaged in a noncompensable activity. These off-the-clock claims in which employers are accused of not giving employees recorded credit for all of the time they have worked sometimes spring from advancing technology. A 2013 poll showed that more than half of employed adults check work messages at least once a day over the weekend, before or after work during the week, and even when they are home sick. An overtime class action suit filed by Jeffrey Allen, a Chicago police sergeant, highlights the impact of technology on time spent working: he says he received a nearly constant barrage of e-mails, text messages, and calls on his government-issued BlackBerry into the late evening, each requiring a response.
In March 2014, President Obama directed the U.S. Department of Labor to address the changing nature of the workplace by updating overtime protections consistent with FLSA's
intent. [For President Obama's Memorandum for the Secretary of Labor, see www.whitehouse.gov/the-press-office/2014/03/13/presidential-memorandum-updating -and-modernizing-overtime-regulations]
Student Interns In a tough job market, unpaid internships become more attractive to job seekers and employers alike. To address potentially abusive situations in which employers seek "free labor," the U.S. Department of Labor in 2010 issued a test for unpaid internships to determine whether the interns are employees with wage rights or trainees who are receiving an educational opportunity for their sole benefit and are thus excluded from FLSA protection. Generally, the more an internship focuses on an academic or classroom experience rather than the host's operations, the more likely it need not be a paid position. If interns, on the other hand, are assisting with the employer's daily operations such as clerical work, then they have a right to minimum wage and overtime. [For the six criteria of the U.S. Department of Labor's test for unpaid internships, see www.dol.gov/whd/regs/compiiance/whdfs71.pdf]
Answer this person's question: "Before I resigned as a sewing manager for a small manufacturing company, where I supervised several employees and received an hourly wage, I regularly arrived at the factor 15 to 45 minutes before the start of my 5:00 AM shift, spending most of that time doing such tasks as reviewing employee schedules, gathering and distributing fabric to my subordinates' workstations, cleaning work area, etc.-but without pay. Does my former employer owe me overtime pay "