Is Your Agency A Candidate For An FLSA Audit?

Every public agency is different. Administrative and human resources policies vary from employer to employer. Thus, there are many factors to consider when determining if your agency is a good candidate for an FLSA Audit. Consider the following:

  • You cannot recall when your agency last audited its FLSA compliance.
  • Your agency has not completed an FLSA Audit for the last two to three years.
  • Your agency utilizes a decentralized time keeping system that varies from department to department.
  • Your employees regularly work over 40 hours in a week.
  • Your employees regularly earn significant amounts of overtime or compensatory time off.
  • Your agency has decided that many of your employees qualify for the white-collar exemptions from the FLSA overtime requirements.
  • Many of your non-exempt employees check email from home.
  • Your agency has public-safety employees
  • Your agency does not keep records of employee work and overtime.

When Should an Employer Conduct an FLSA Audit?

Preparation for Labor Negotiations

Part of an employer’s preparations for labor negotiations should involve an FLSA analysis of collective bargaining agreements and pay policies. Using the collective bargaining process to bring payroll practices into compliance with FLSA requirements can enable an employer to make appropriate changes without generating undue concern.

Revisions to Personnel Rules, Municipal Code or Charter

Portions of an employer’s personnel rules, municipal code and charter provisions invariably affect how an employer compensates its employees. As a result, whenever an employer revises its rules, municipal code or charter, the employer should also conduct an FLSA compliance review to eliminate provisions that may conflict with FLSA requirements.

Classification Changes

Whenever an employer creates or modifies a classification, the job duties should be reviewed to determine whether that classification performs duties that qualify for one of the white collar exemptions from the FLSA overtime requirements.

Response to Grievances or Complaints

Employees generally file FLSA lawsuits in response to an underlying labor dispute or a disciplinary action. Thus, an employer is well advised to promptly investigate any grievance or complaint that even remotely infers that the employer’s pay practices violate the FLSA. The employer’s failure to investigate could preclude the employer from asserting a good faith defense in the event of litigation.