FLSA Coverage

The Fair Labor Standards Act provides two different ways for coverage to apply:

  1. Individual coverage - an individual whose work affects interstate commerce is covered as an individual - "interstate commerce" is defined so broadly that practically anything fits, such as ordering, loading, or using supplies from out of state, accepting payments from customers based on credit cards issued by out-of-state banks, and so on

  2. Enterprise coverage - for most businesses, enterprise coverage applies if the business is involved in interstate commerce and the gross annual business volume is at least $500,000 - in that case, all employees working for the business are covered.

    1. Coverage is automatic for schools, hospitals, nursing homes, or other residential care facilities.

    2. Coverage is also automatic for all governmental entities at whatever level of government, no matter how big or small.

    3. Coverage does not apply to certain entities that are not organized for a business purpose, such as churches and eleemosynary institutions.

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