Summary: If you are a flag rate worker navigating an overtime pay dispute, you may need legal help. Speak with an attorney about collecting the overtime wages you deserve.
Under the provisions of the Fair Labor Standards Act (FLSA), covered, non-exempt employees must be paid overtime wages. Most employees are considered non-exempt under the FLSA, including some flat or flag rate employees.
If you are a flag rate worker facing an unpaid overtime violation issue, an attorney can help you understand the laws that apply to your situation. A proactive lawyer can help you file a wage and overtime dispute while offering dedicated legal representation to assert your right to fair compensation.
How Overtime Works for Flag Rate Workers
Flag rate workers are paid at a fixed rate for a given task, no matter how long it takes to complete the task from start to finish. Employees in various industries may be paid on a flag rate basis, but this is a particularly common arrangement with individuals employed as mechanics and construction workers.
While flag rate payments are less common than other compensation structures, employees who are compensated this way for their work are still protected by labor laws. For example, workers who are receiving a flag rate must still be paid at least the minimum wage or else their employer is violating the FLSA.
Often, employers determine flag pay rates by identifying the amount of time it should take for the worker to complete a given task, known as flag time. Then, the company multiplies the flag time by an hourly pay rate to determine the worker’s final rate of pay.
Regardless of how that final flag pay rate is determined, non-exempt employees who are compensated this way should still receive full overtime wages. Overtime wages should be equal to one and a half times the worker’s standard earnings. Pay for overtime kicks in as soon as the eligible employee exceeds eight hours in a workday or 40 hours in a workweek.
Understanding the 7i Exemption for Flag Rate Workers
Some but not all employees who are paid under a flag rate or flat rate structure are entitled to overtime pay by law. The way in which flag workers are paid will determine whether or not they are considered non-exempt and should receive overtime.
For example, the FLSA 7i exemption allows certain employees in retail or service establishments who are paid primarily on a commission basis (often through a flat or flag rate system) to be exempt from overtime pay requirements.
This means that if an employee earns more than half of their pay from commissions and their regular rate exceeds 1.5 times the minimum wage, they may not be eligible for overtime pay, even if they work long hours. However, being a flag rate worker does not equal an automatic exemption from overtime.
Claiming Compensation for Unpaid Overtime Violations
Many employers look for ways to avoid paying flag rate workers for overtime. Flag rate workers and other employees who are illegally deprived of overtime can sue to recover back wages. There are numerous ways that an employer may engage in overtime violations against flag rate workers, such as by:
- Paying straight time
- Requiring off-the-clock work
- Misclassifying employees as independent contractors
It is also illegal for an employer to claim that a worker being paid on a flag rate basis makes them exempt from overtime. An experienced attorney can help you understand if you have not been fairly compensated for overtime work while working diligently to secure your wages.
A lawyer who understands the complexities of wage and hour laws, as well as the legal processes involved, can effectively advocate for your rights. A proactive attorney can also gather evidence to build a strong case against your employer and negotiate a fair settlement. Financial recovery in a flag rate overtime case can include:
- Back wages
- An equal amount of liquidated (double) damages
- Interest
- Attorneys’ fees
Let a Flag Rate Overtime Pay Attorney Stand Up for Your Rights
If you believe that your employer is not paying you fairly, you should consult with an attorney. Our lawyers have specific experience and knowledge of the overtime laws for flag rate workers.
We can evaluate your circumstances and determine what legal action is possible. Contact us by using the chat box or intake form to request your free, confidential review.
