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Reconciling state and federal laws covering wage and hours rules

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Employers are besieged with compliance issues in the labor/employment area. One very tricky area is compliance with both the federal Fair Labor Standards Act (FLSA) and the Pennsylvania Minimum Wage Act (PMWA). Compliance with one doesn't necessarily satisfy the other, because many provisions of the laws differ.

There was a time in Pennsylvania decades ago when the PMWA applied only to Pennsylvania employers that were too small to fall under federal jurisdiction. However, FLSA jurisdiction has expanded, so that most employers are now subject to coverage, and the PMWA has been amended to apply to private employers, regardless of size, even those covered by FLSA.

A recent change to Pennsylvania law removed two conflicts for health care institutions when Gov. Corbett signed House Bill 1820 last July 5.

The measure was introduced by Rep. Sheryl Delozier, R-Cumberland, to solve a situation in which a hospital could be in compliance with the FLSA, but in violation of state law, when it paid employees overtime after eight hours in a day and 80 hours in a two-week pay period — the so-called 8/80 Rule. Under Pennsylvania law, the employer still would have been required to pay overtime after 40 hours in any individual workweek.

With the new law, the use of the 8/80 Rule has become legal in Pennsylvania for certain health care institutions. This solves a compliance headache for a number of hospitals and other health care institutions, eliminating possible state wage and hour audits or lawsuits based on wage and hour violation under Pennsylvania law.

It's worth noting that health care employers utilizing the 8/80 Rule should still be alert to a Pennsylvania law on excessive overtime in health care, which is separate from the PMWA's limiting overtime hours for certain health care employees and mandating breaks between service times. Federal law has no health care equivalent.

Other important differences still exist between the Pennsylvania Minimum Wage Act and the federal Fair Labor Standards Act.

These include differences in the way highly compensated employees are treated, the salary threshold for classification as an overtime-exempt white-collar employee, differences in overtime requirements in the home health care industry, lack of state exemption for computer systems and software designers, and lack of coverage of public agencies.

These distinctions are important enough to result in significant liability for unwary employers, even those who believe that they are in compliance.

Please remember that, as a Pennsylvania employer, compliance must be achieved, not assumed.

More information appears on the Pennsylvania Department of Labor and Industry's website at "Overtime Rules in Pennsylvania."

Kathy Speaker MacNett is a managing member of the Harrisburg law firm SkarlatosZonarich. Brian W. Mains is an associate attorney and certified compliance and ethics professional at the firm.

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