Business Compliance Attorneys
From Wall Street to Main Street, the American government has regulations for everything a business can do. For the most part, regardless of how big or small a business is, they have to follow these regulations or face major consequences, whether that’s being sued by a state or federal agency for violations or your own employees. Business compliance attorneys, whether corporate compliance attorneys or small business compliance attorneys, like our friends at Mughal Law Firm, PLLC, seek to ensure that your business operations meet government regulations so you do not have to worry about civil litigation from employees, customers, or the federal government. The Fair Labor Standards Act is an example of federal regulation that can be confusing to business owners, and whose violation can carry stiff penalties.
Small Business Compliance Attorney
The Fair Labor Standards Act set forth a minimum wage and overtime pay for employees who work more than 40 hours in a single week pay period or 80 hours of their hourly rate times 1.5, commonly referred to as “time and a half.” What you might not be aware of is that if you are paying an employee a salary, they may still be entitled to overtime. This isn’t universal, there are multiple industries that are exempt. There are also exceptions for administrators, managers, and employees who require advanced degrees to be able to perform their job functions. But, if you are engaged in commerce and your employee doesn’t perform administrative or management tasks more than 40% of the time, they are entitled to overtime. Let’s say you’re a restaurant owner, and you have a front of house and back of house manager. You’re shorthanded, so most of the time they work as a waiter, host, or line cook. Maybe 2 hours of a work day they manage staff and perform other managerial or administrative tasks. Five days of work a week would mean 10 hours a week, which would be 25% of the work week. That manager would be considered a non-exempt employee under the FLSA, at least for weeks where he worked 2 hours a day every day. In order to calculate the overtime wages that employee would be owed, you have to divide that week’s salary by the number of hours worked to figure out what the hourly rate would be if they were an hourly employee. You then multiply that number by .5, which gives you the overtime rate for the overtime hours. Then that overtime rate is multiplied by the overtime hours worked to get the overtime pay that the employee is owed. Say this employee worked 60 hours one week, and only 10 hours of that was spent managing employees. If they are paid $600.00 per week, that would give an hourly rate of $10.00, which would give an overtime rate of $5.00. With 20 hours of overtime, that would be $100.00. If left unpaid, this can add up. Say every day for two years your manager worked 60-hour weeks and managed for 10 hours a week. That would be $10,400.00 of unpaid wages for those two years. If this employee were to sue, these wages could be doubled by the court for a total of $20,800.00. And if you have four managers who work similar hours, this can add up even higher. A small business compliance attorney can look over your records and advise you on how to apply the law to your business in order to avoid these mistakes and save you money in the long run.
The FLSA is only one example of federal regulations, there’s OSHA regulations, National Labor Relations Act regulations, Food and Drug Administration regulations, the Environmental Protection Act, and many more that your business could potentially be in violation of. And this is not taking into account the various state and local regulations.