Q.1.

FLSA relates to the laws that outline the employer requirements to adhere to employee remuneration in terms of working and pay packages. Based on employee’s job security, the Act requires the employers to contribute certain amounts to the social security kitty. At the same time, the work security is ensured through outlaw of discirmiaytve practices such as prohibition of employemmnt termination based on any discriminative motive, such as Title VII (Keler & Preziosi, 2008).

Q2.

Various methods are used to determine the appropriate level of wages and employment benefits . There is the Formal seniority system. Under this system, it is expected that employees who have taken longer time in an organization should be paid higher. As such, during the employment, employees are informed host the system works , and the fact that there is no gender based discriminations. Secondly, there is Temporary Employee Training or Development Assignment. Under this method, employees on training or probation would be paid at a lower rate than the incumbents. Another method is the Formal merit system. Under this system, employees are rated in an objective manner and the pay differentials applied. Such ratings should be formal , consistent , non discriminative and spell the jobs under which the method is applied.

In my view, the Formal seniority system is the most important method. This is because the incumbents have a lot of experience that can be translated into quality work and higher productivity.

This view is supported by Dohmen (2003) who argues that the seniority system is based on the principle that a “job typically encompasses a handful of salary scales so that the contractual within-job tenure profile is extended upon promotion to a higher scale”. As such it is sensible to associate seniority with higher salary scale as well as hierarchical level.

Q3.

 

As a merit, the outcome of the case reaffirmed the role of the Congress with regards to determination of minimum wages and ensuring that the laws relating to over time pay are observed in all the states and by the local governments. As such, the Congress was has been empowered to ensure that regulatory measures are in place to ensure that both wages and work hour issues are taken into account by all employers. Significantly, the case redefined the federal system, with regards to regulation of the labor market and issues relating to state sovereignty (Suffolk University, 2007).

Generally, an employer, either an individual or a body, would be risking highly by not adhering to the laid down requirements of FLSA. One of the possible consequences will be fine that may run into millions of dollars. Such a fine would be imposed on the culprit for failing to meet the requirements of the Act. Also, employers may be ordered to pay all the dues to the employers and back date the same to specific times. At the same time, the resultant negative publicity would result into loss of business opportunity and inability to attract top and talented potential job candidates. At the same time, the violators may be jailed for failing to follow the due requirements of the law.

Having more part time employees is beneficial in the sense that an organization will incur lower direct labor costs. As such, some of the part timers may not be privileged to enjoy such benefits as insurance. At the same time, the part timers are normally more enthusiastic to work and achieve the set targets within the given time limit. Further, an organization may easily meet its labor demand during peak periods. An organization will therefore not be constrained to look for and permanent employee new staff members during such times.

However, this method has some drawbacks such as possibility of high rate of absenteeism among the employees due to unexpected changes such as possibility of a better pay.

At the same time, the short time of engagement may mean that the employees take longer to learn such that their output may be compromised.

Having too much overtime is influenced by:

Time period : for example during peak seasons for certain products and services such as Charismas, it is likely that such places as hotels would have more overt time.

Emergency situation : emergency may force an organization to have overtime, such as breakdown of a machine that needs repair.

Higher order: when unusually higher volume of order is made, it is likely that overtime may be allowed to meet the clients’ expectations. For example, if a an organization receives 20 orders a week and 40 more are received, there may be need for much overtime.

Performance, Seniority and Wages:

Formal Salary Systems and Individual

Earnings Profiles

Thomas J. Dohmen

IZA Discussion Paper No. 935

Journal of Business & Economics Research – November, 2008

Volume 6, Number 11

7

Management & Law: FLSA Regulations

And Compensation Policies – Their Legal

Exposure And Business Impact

Ruth Torres, Keller Graduate School of Management, USA

Robert C. Preziosi,

SUFFOLK UNIVERSITY SUFFOLK UNIVERSITY LAW REVIEW

[Vol. XL:4

http://www.law.suffolk.edu/highlights/stuorgs/lawreview/documents/Littman_Comment_FINAL.pdf.