labor lawAdivision of labor law center

 On July 24, 2008, when the federal minimum wage increased to $6.55 per hour, the Oklahoma state minimum wage increased, too. The state law for the Oklahoma minimum wage doesn’t even contain a dollar amount, but merely requires the state to match the federal minimum wage.

The increase in the federal minimum wage was the second in a series of three 70-cent increased mandated by the Fair Minimum Wage Act of 2007. The next increase in the federal minimum wage will occur on July 24, 2009, so the Oklahoma state minimum wage will increase on that date, as well.

The state minimum wage, according to the Oklahoma Department of Labor, (more…)

Is your company computing overtime properly? Retail giant Wal-Mart is paying out $33 million in back wages after being accused of underpaying more than 86,000 workers in overtime pay.

Wal-Mart’s agreement to pay the amount puts it in compliance with federal and Oklahoma Overtime laws, according to the U.S. Department of Labor. The Labor Department said the retailer used the wrong pay figures to calculate overtime in Oklahoma and throughout the U.S.

The U.S. Department of Labor says the retail giant calculated the employees’ overtime on their base pay alone, and not on their pay plus incentives and premium payments, which is called the “average hourly compensation.” Wal-Mart essentially violated the Fair Labor Standards Act (FLSA).

The FLSA requires, first, that employees be paid 1.5 times their normal pay (called “time-and-a-half”) for any time worked over 40 hours. Second, overtime must be calculated against their “average hourly compensation,” not their base pay. In other words, if employees get $6 an hour base pay but incentives and premiums amount to an average hour pay of $7 an hour, then the overtime must be calculated according to the $7 an hour figure.

The country’s largest retailer agreed to pay all back ages for the violations between February 1, 2002 and January 19, 2007, and it has agreed to pay interest on the amount. According to the Labor Department, that should act as a deterrent.

“This settlement provides $33 million in back wages, plus interest, to Wal-Mart workers,” said Assistant Secretary of Labor for Employment Standards Victoria A. Lipnic. She added that the company “has taken corrective action to prevent this from happening again.”

A consent judgment in U.S. District Court supported the agreement that the Labor Department obtained from Wal-Mart. After the Labor Department filed a complaint, the court promptly declared that Wal-Mart must pay all of the back wages for the violations – the $33 million, in other words – and pay interest on that amount, as a deterrent to similar future violations.

Oklahoma has no state overtime law, so that leaves us with nothing to talk about in a blog entry about Oklahoma’s overtime labor law. Right? Wrong. Actually, just because Oklahoma does not have its own state laws for overtime regulations, that doesn’t mean there isn’t a law that employers in Oklahoma have to follow.

Just the opposite. There is an overtime law that they have to follow, it’s the law of the land. The federal overtime laws can be found in the Fair Labor Standards Act, or FLSA for short. This law also covers such issues as minimum wage and other issues like child labor.

For our focus of this blog, though, we’ll stick with how the FLSA affects how employers pay overtime to employees in Oklahoma. In that case, not all employers are affected and have to follow the federal law. Only certain classes of businesses have to actually pay their employees overtime under federal regulations.

The first main class of employer who has to follow the FLSA overtime laws are those that are considered “interstate” employers. This means that either they have offices in and outside of Oklahoma, or that they provide goods and services to people and businesses outside of the state.

Another differentiator for employers who have to follow FLSA in Oklahoma is the size of the revenue. If a business brings in more than $500,000 in revenue per year, they’re liable to have to pay overtime under the FLSA.

Lastly, there are types of businesses that in general have to pay overtime under FLSA no matter how big or small they are. These include schools of all sizes—from universities to elementary schools—hospitals, and government entities.

That being said, what do all these classes of employers have to pay, as overtime, under the FLSA? The law of the land states that they owe their employees, with some exceptions, at least time and a half their normal wage for all time they spend working over 40 hours in a week.