The minimum wage in South Dakota is now $6.55 per hour. On July 24, 2008 when the federal minimum wage increased from $5.85 per hour. Under state law, the South Dakota minimum wage also increases to reflect the change in the federal minimum wage.
The Fair Minimum Wage Act of 2007increased the federal minimum wage from $5.15 per hour to $7.25 per hour. However, the increase didn’t go into effect all at once. Under the federal law, the minimum wage increases in three 70 cent steps. The first step went into effect 60 days after the President signed the bill into law, on July 24, 2007. The other two increases occur on the same dates in 2008 and 2009.
Federal and South Dakota overtime laws have been the subject of a recent court ruling which orders the nation’s largest retail employer to pay back wages plus interest to employees who received less overtime pay than the law allows. The payout totals more than $33 million and affects more than 86,680 employees.
In a recent announcement, the US Department of Labor (DOL) said Wal-Mart Stores, Inc. (Wal-Mart), failed to maintain compliance with laws pertaining to calculating South Dakota minimum wage overtime payments. Wal-Mart used base rates of pay to compute overtime wages for employees who were regularly receiving incentives and over premium payments in addition to base pay.
To illustrate this point, consider an employee who earns a base pay rate of $6.00 per hour but who also receives incentive and premium payments on a regular basis. In this example, the employee is regularly paid an all-inclusive rate of $7.00 instead of the $6.00 base. To remain in compliance with federal and state laws, the employee’s overtime rate of pay must be calculated using the $7.00 per hour rate, not $6.00.
Both the South Dakota overtime law and the federal law consider a standard work week to be 40 hours. Any work done in excess of 40 hours for the week is considered overtime and the rate of pay is increased to 1.5 times the standard pay rate.
The DOL complaint was filed in US District Court, where it was promptly approved. Compensation for unpaid back wages must be paid, along with interest on these unpaid wages, as a deterrent to future violations of these laws.
“This settlement provides $33 million in back wages, plus interest, to Wal-Mart workers, and the company has taken corrective action to prevent this from happening again,” said Victoria A. Lipnic, DOL’s Assistant Secretary of Labor for Employment Standards.
The court order requires payment of miscalculated overtime wages for the period beginning on February 1, 2002, and continuing until January 19, 2007.
There are a certain number of states in the United States that, when it comes to overtime, they defer to the federal government to guide employers and employees as to what the deal is. South Dakota is one of those states.
In South Dakota, there are no state overtime labor laws. There aren’t laws either, by the way, regarding compensatory time, regarding salaried and hourly workers, or regarding the difference between part-time and full-time workers.
But our focus is on overtime, so to understand South Dakota’s overtime regulations, we must look at what the federal laws say about overtime. The federal laws on the topic can be found in the Fair Labor Standards Act. Basically, this is the law that covers most wage issues that employers and employees in South Dakota would need to be concerned with.
To understand how the Fair Labor Standards Act regulations on overtime work, it’s probably easiest to break down the law into two parts in terms of coverage. This two-part system can help us determine who gets overtime in South Dakota based on the FLSA, and who doesn’t.
The first part of the FLSA overtime coverage is called “Enterprise” coverage, which means it determines which enterprise, or business, is mandated by the FLSA to pay overtime labor costs. This part of the law says that enterprises with more than $500,000 in annual revenue are covered by the FLSA.
The Enterprise section also includes businesses that operate hospitals and similar medical care and hospice type locations, as well as schools and public or governmental entities.
The second part of the overtime law is the “Individual” coverage. This determines if an individual employee should or should not get overtime pay. This coverage includes any employee of any business who is involved in any form of interstate commerce. This could include sales across state borders, or it could even involve taking the credit card from someone who is from North Dakota.