A Basic Survival Guide for US Department of Labor Wage and Hour Inspections

If you are scheduled for an inspection by the U.S. Department of Labor (USDOL) Wage and Hour Division, here's what you need to know to be prepared:

How will the inspection be done?

Some growers receive letters ahead of time from USDOL regarding an appointment. It is also possible that the USDOL will do a random check. Growers can expect the agents to ask to see business and payroll records and to speak with employees. The inspectors typically speak with employees for a few hours (field interviews) and then go over office records and interview an employer representative for a few hours. This is an in-depth inspection.

What regulations and laws will the USDOL inspections cover?

The USDOL inspectors will be enforcing only federal labor laws and regulations. USDOL will inspect for the Fair Labor Standards Act, the Migrant and Seasonal Agricultural Worker Protection Act, and the Immigration and Naturalization Act. USDOL also enforces the Family Leave and Medical Act, but they have not indicated that this will be a focus of the inspections.

The Fair Labor Standards Act (FLSA)

FLSA covers federal minimum wage, payroll record keeping, overtime, and child labor laws.

Proving coverage
Historically, the USDOL agents have begun inspections by asking questions (such as "Who are your biggest customers?") and requesting records (such as total sales receipts for last year) that demonstrate you are covered by the Fair Labor Standards Act. This can involve business records showing sales receipts, financial statements and customer lists. In order to minimize the questions or the need for records, if you know that you are covered by the law just tell the agent that you understand the coverage and that you are covered.

There are two ways in which an employee can be covered by the law: "enterprise coverage" and "individual coverage."

• Enterprise Coverage - Employees who work for certain businesses or organizations ("enterprises") are covered by the FLSA. These enterprises must have at least two employees and do at least $500,000 per year in business.
  
  Any employer in agriculture who did not utilize more than 500 "man days" of agricultural labor in any calendar quarter of the preceding calendar year is exempt from the minimum wage and overtime pay provisions of the FLSA for the current calendar year. A "man day" is defined as any day during which an employee performs agricultural work for at least one hour.


• Individual Coverage - Even when there is no enterprise coverage, employees are protected by the FLSA if their work regularly involves them in commerce between states ("interstate commerce"). In its own words, the law covers individual workers who are "engaged in commerce or in the production of goods for commerce."

Additional exemptions from the minimum wage and overtime provisions of the FLSA for agricultural employees apply to the following:

• Agricultural employees who are immediate family members of their employer


• Those principally engaged on the range in the production of livestock


• Local hand harvest laborers who commute daily from their permanent residence, are paid on a piece rate basis in traditionally piece-rated occupations, and were engaged in agriculture less than 13 weeks during the preceding calendar year


• Non-local minors, 16 years of age or under, who are hand harvesters, paid on a piece rate basis in traditionally piece-rated occupations, employed on the same farm as their parent, and paid the same piece rate as those over 16

Bottom line: Just about every grower is covered by the FLSA unless they meet one of the above narrow exemptions.

Minimum wage

Federal minimum wage is currently $6.55 per hour. Washington state minimum wage is currently $8.07 per hour. The USDOL will not be checking for compliance with state minimum wage. Make sure you have the federal minimum wage poster posted. Call WGL if you need one or more.

Record keeping

Every covered employer must keep certain records for each non-exempt worker. FLSA requires no particular form for the records, but does require that the records include certain identifying information about the employee and data about the hours worked and the wages earned. The law requires this information to be accurate. Following is a list of the basic records that an employer must maintain:

• Employee's full name and Social Security number


• Address, including ZIP code


• Birth date, if younger than 19 years


• Sex and occupation


• Time and day of week when employee's workweek begins


• Hours worked each day


• Total hours worked each workweek


• Basis on which employee's wages are paid (e.g., "$6 an hour" or "$220 a week" or "piece work")


• Regular hourly pay rate


• Total daily or weekly straight-time earnings


• Total overtime earnings for the workweek


• All additions to or deductions from the employee's wages


• Total wages paid each pay period


• Date of payment and the pay period covered by the payment

Timekeeping
Employers may use any timekeeping method they choose. For example, they may use a time clock, have a timekeeper keep track of employee's work hours, or tell their workers to write their own times on the records. Any timekeeping plan is acceptable as long as it is complete and accurate.

Employees on Fixed Schedules
Many employees work on a fixed schedule from which they seldom vary. The employer may keep a record showing the exact schedule of daily and weekly hours and merely indicate that the worker did follow the schedule. When a worker is on a job for a longer or shorter period of time than the schedule shows, the employer must record the number of hours the worker actually worked, on an exception basis.

Retaining records
Each employer shall preserve for at least three years payroll records, collective bargaining agreements, sales and purchase records. Records on which wage computations are based should be retained for two years - for example, time cards and piece work tickets, wage rate tables, work and time schedules, and records of additions to or deductions from wages. These records must be open for inspection by the USDOL representatives. They may ask the employer to make extensions, computations, or transcriptions. The records may be kept at the place of employment or in a central records office.

Overtime

Agricultural production is exempt from overtime laws. Employees who are employed in agriculture (including farm, but not warehouse or packing shed office staff) as that term is defined in the FLSA are exempt from the overtime pay provisions. These employees do not have to be paid time-and-a-half their regular rates of pay for hours worked in excess of 40 per week.

Some common areas of concern:

• Failing to pay overtime to employees whose jobs are related to agriculture but which do not meet the definition of agriculture contained in the FLSA.


• Not keeping or maintaining records of the names and permanent addresses of temporary agricultural employees, dates of birth of minors under age 19, or hours worked by employees being paid on a piece rate basis.

Farm Labor Contractors

Agricultural employers who utilize the services of a farm labor contractor are almost always in a situation of joint employment with the contractor in regard to the employees. Joint employment means that both the contractor and the farmer are responsible for complying with the minimum wage, overtime, record keeping, and child labor provisions of the law. If either party fails to comply with the law, both parties may be held liable.

Child Labor Regulations

This is a special concern of the USDOL Wage and Hour Division, especially in agriculture. They will be looking for evidence that you are employing minors under 16 years old. If you are, they will be looking for evidence that you are meeting the conditions of the federal regulations.

Summary of Federal Child Labor Regulations for Agriculture:

• Youths ages 16 and above may work in any farm job at any time.


• Youths aged 14 and 15 may work outside school hours in jobs not declared hazardous by the Secretary of Labor.


• Youths 12 and 13 years of age may work outside of school hours in non-hazardous jobs on farms that also employ their parent(s) or with written parental consent.


• Youths under 12 years of age may work outside of school hours in non-hazardous jobs with parental consent, but only on farms where none of the employees are subject to the minimum wage requirements of the FLSA.


• Local youths 10 and 11 may hand harvest short-season crops outside school hours for no more than eight weeks between June 1 and October 15 if their employer has obtained special waivers from the Secretary of Labor.


• Youths of any age may work at any time in any job on a farm owned or operated by their parents.

Hazardous Occupations in Agriculture for minors
Minors under 16 may not work in the following occupations declared hazardous by the Secretary of Labor:

• Operating a tractor of over 20 PTO horsepower, or connecting or disconnecting an implement or any of its parts to or from such a tractor


• Operating or working with a corn picker, cotton picker, grain combine, hay mower, forage harvester, hay baler, potato digger, mobile pea viner, feed grinder, crop dryer, forage blower, auger conveyor, unloading mechanism of a nongravity-type self-unloading wagon or trailer, power post-hole digger, power post driver, or nonwalking-type rotary tiller


• Operating or working with a trencher or earthmoving equipment, fork lift, potato combine, or power-driven circular, band or chain saw


• Working in a yard, pen, or stall occupied by a bull, boar, or stud horse maintained for breeding purposes; a sow with suckling pigs; or a cow with a newborn calf (with umbilical cord present)


• Felling, buckling, skidding, loading, or unloading timber with a butt diameter of more than six inches


• Working from a ladder or scaffold at a height of over 20 feet


• Driving a bus, truck or automobile to transport passengers, or riding on a tractor as a passenger or helper


• Working inside a fruit, forage, or grain storage designed to retain an oxygen-deficient or toxic atmosphere; an upright silo within two weeks after silage has been added or when a top unloading device is in operating position; a manure pit; or a horizontal silo while operating a tractor for packing purposes


• Handling or applying any toxic agricultural chemical identified by the words "danger," "poison," or "warning" or a skull and crossbones on the label


• Handling or using explosives


• Transporting, transferring, or applying anhydrous ammonia

The prohibition of employment in hazardous occupations does not apply to youths employed on farms owned or operated by their parents.

In addition, there are some exemptions from the prohibitions:

• 14- and 15-year-old student learners enrolled in vocational agricultural programs are exempt from certain hazardous occupations when certain requirements are met; and


• Minors aged 14 and 15 who hold certificates of completion of training under a 4-H or vocational agriculture training program may work outside school hours on certain equipment for which they have been trained.

The Migrant and Seasonal Agricultural Worker Protection Act (MSPA)

MSPA covers farm labor contractors, notification of employees, housing, and transportation.

Coverage
This is critical if you are claiming to be exempt! You may claim one of three exemptions: the family business exemption, the small business exemption, or the 25 mile/13 week "short-term local" exemption. If you believe you are exempt, you will be asked to prove it.

Worker Notification and Protection
Covered employers must give a Worker Information Notice when required to communicate the terms and conditions of work to certain employees. Employees must also be provided a pay stub with certain information. Wages must be paid at least twice per month.

Housing
Agents may inspect for compliance with state and federal farm worker housing laws. Terms and conditions of housing must be posted.

Farm labor contractors
USDOL agents want to know if you use a contractor, and if you do, if the contractor has a federal license.

Transportation
USDOL agents may inspect for compliance with MSPA transportation regulations, including insurance coverage.

Poster
You must have a MSPA poster displayed if you are covered. Call WGL if you need one or more.If you need more information on MSPA compliance, please call the Growers League at 509-575-6315. We have several summary documents available.

Immigration and Nationality Act (INA)

The INA is the basic body of immigration law. The USDOL inspectors may conduct an I-9 audit to check for compliance with the law.

More detailed information on these laws and regulations is available from the Washington Growers League. Please call our office at (509) 575-6315 if you have any questions.

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USDOL Wage and Hour Inspection Guide