The Fair Labor Standards Act (FLSA), Explained in 2026
The FLSA is the federal law that creates the right to a minimum wage, overtime pay for hours over 40, protections from child labor, and employer recordkeeping requirements. The exemptions from these rights are what the exempt vs non-exempt classification debate is entirely about.
Origins: the 1938 Act
Congress passed the Fair Labor Standards Act in 1938 under the Commerce Clause of the Constitution. President Roosevelt signed it on 25 June 1938. The primary purposes were to establish a national minimum wage (initially 25 cents per hour), create a standard workweek (initially 44 hours, later reduced to 40), prohibit oppressive child labor, and require employers to maintain records of hours and wages.
The Act was a response to Depression-era labor conditions in which workers had little bargaining power and employers routinely required extremely long hours at minimal pay. The Act has been amended dozens of times since, but its core structure - minimum wage, overtime at 1.5x for hours over 40, child labor restrictions, recordkeeping, and the white-collar exemptions - remains intact.
Who is covered: enterprise coverage and individual coverage
Coverage under the FLSA comes through two independent routes. Enterprise coverage applies to businesses with annual gross revenues of at least $500,000 and that have two or more employees engaged in interstate commerce. Nearly all businesses of any meaningful size meet this threshold.
Individual coverage applies to any individual employee engaged in interstate commerce or in the production of goods for commerce, regardless of the employer's size or revenues. Even a small employer with low revenues may have employees covered by the FLSA individually if they regularly use the phone, mail, email, or the internet across state lines - which is virtually every office worker. The result is that the FLSA covers almost all employees in the United States.
Core provisions
FLSA § 206Minimum wage
Sets the federal minimum wage, currently $7.25/hour (unchanged since July 2009). Many states and localities have higher minimums; the higher of the two applies. Federal minimum wage for tipped employees is $2.13/hour with the employer obligated to make up the difference to $7.25.
FLSA § 207Overtime
Requires overtime pay at 1.5 times the employee's regular rate of pay for all hours worked beyond 40 in a workweek. The workweek is any fixed and regularly recurring period of 168 consecutive hours (7 days). Employers can define when the workweek starts and ends, but cannot change it to avoid overtime obligations.
FLSA § 212Child labor
Prohibits employing minors in occupations that are hazardous or detrimental to their health or well-being. The Act sets minimum ages for various types of work (generally 16 for most jobs, 18 for hazardous occupations). Child labor provisions have no exemption based on salary.
FLSA § 211Recordkeeping
Requires employers to keep accurate records of hours worked and wages paid. Non-exempt employees must have time records. Exempt employees are generally not subject to the same detailed timekeeping requirements, though employers may still track their hours voluntarily. Records must be preserved for at least three years.
FLSA § 213(a)(1)The white-collar exemptions
The section that empowers the Department of Labor to define exemptions from the minimum-wage and overtime requirements for executive, administrative, and professional employees. This is the statutory basis for all the FLSA classification rules discussed throughout this site.
29 CFR Part 541: the rulebook for white-collar exemptions
The DOL's regulations implementing the white-collar exemptions are found in Title 29 of the Code of Federal Regulations (CFR), Part 541. This is the primary legal reference for everything on this site. The key subparts are:
| Subpart | Topic |
|---|---|
29 CFR 541.100-106 | Executive exemption - salary requirement, management, two-employee rule, concurrent duties |
29 CFR 541.200-204 | Administrative exemption - office work, management/business operations, discretion and independent judgment |
29 CFR 541.300-304 | Professional exemption - learned professional, advanced knowledge, creative professional |
29 CFR 541.400-402 | Computer employee exemption - qualifying roles, hourly/salary threshold |
29 CFR 541.500-504 | Outside sales exemption - away from place of business, sales as primary duty |
29 CFR 541.600-606 | Salary requirements for EAP exemptions - salary level, salary basis, deductions, fee basis |
29 CFR 541.601 | Highly compensated employee exemption |
29 CFR 541.700-701 | Primary duty definition; 'customarily and regularly' standard |
Amendment history and rulemaking timeline
FLSA enacted. Min wage 25 cents/hr, overtime threshold 44 hours/week (reducing to 40 by 1940).
Portal-to-Portal Act. Narrowed 'hours worked' to exclude ordinary commuting and preparatory activities.
Equal Pay Act added as amendment to FLSA. Prohibited wage discrimination based on sex for equal work.
Bush-era FairPay regulations rewrite. Raised salary threshold to $455/week ($23,660/year). The term 'white collar exemptions' was formally codified.
Obama DOL final rule would have raised threshold to $913/week ($47,476/year). Blocked by a federal court injunction (E.D. Tex., Judge Mazzant) before taking effect.
Trump DOL final rule. Raised threshold to $684/week ($35,568/year). Currently in force.
Biden DOL published final rule: first-phase increase to $844/week effective 1 July 2024; second phase to $1,128/week effective 1 January 2025.
Eastern District of Texas (Judge Sean Jordan) vacated the entire Biden-era rule nationwide in State of Texas v. U.S. Dept of Labor. Threshold reverted to $684/week.
Trump DOL moved to hold the appeal in abeyance at the Fifth Circuit. No new rule proposed.
Status quo: $684/week in force. No active rulemaking.
Enforcement and remedies
The FLSA is enforced by the DOL's Wage and Hour Division (WHD). Employees can file free confidential complaints with the WHD, which will investigate and may pursue back wages and civil penalties from the employer. WHD represents the public interest, not individual employees, but its investigations often result in payments to affected workers.
Employees also have a private right of action under 29 USC § 216(b): they can sue their employer directly in federal or state court. This is typically done through an employment attorney on a contingency basis.
Remedies available under 29 USC § 216(b):
- • Back wages - all unpaid overtime for the lookback period
- • Liquidated damages - an equal amount to back wages (doubles the recovery), unless employer shows good faith and reasonable grounds
- • Attorney fees and costs - paid by the employer if the employee prevails
- • Injunctive relief - court order to stop future violations
Statute of limitations:
2 years for non-willful violations. 3 years for willful violations (employer knew the conduct violated the FLSA, or showed reckless disregard for that possibility). The distinction matters enormously in calculating back-wage exposure.
What the FLSA does not do
The FLSA does not require employers to provide: vacation pay, sick pay, holiday pay, severance pay, rest periods (beyond what is needed for very short breaks under 20 minutes), meal periods (unless they are compensable), premium pay for weekends or holidays (unless those push hours over 40 in a workweek), or pay raises. These benefits are governed by contract, state law, and employer policy.
The FLSA also does not limit the total number of hours an adult employee can be required to work. An employer can legally require an exempt employee to work 80-hour weeks. The FLSA's protection for non-exempt workers is the cost of that time: 1.5x pay for every hour over 40 per week.
Educational content only. Employment classification is fact-specific; consult an employment attorney or your state labour department. Data verified April 2026.