Wage, hour policies and job descriptions of child care workers come under scrutiny of the Fair Labor Standards Act (FLSA) because the eligibility of paid overtime for some employees at preschools is vague. The confusion lies within the work status of an employee, which is based on the type of job and the salary. If an employee has exempt status, they are ineligible for paid overtime; however, if an employee has non-exempt status, they are eligible for paid overtime.
Under FLSA, employers must pay their workers at least the minimum wage set by Congress and provide time-and-a-half pay for those working more than 40 hours in any work week. As noted by Laura J. Hazen and Michelle B. Ferguson, a common misconception regarding this law occurs over whether employees who are paid a salary rather than an hourly rate are exempt from overtime pay. FLSA states that exempt employees are individuals working in an executive, administrative or professional capacity, but does not define those terms.
Employees who are misclassified as exempt can recover back wages for a two- or three-year period depending on the severity of the violations. If the issue has resulted in a court hearing, they may also be able to recover attorney fees and court costs. Employers may be subject to fines of up to $10,000 for the first offense. The Department of Labor can also assess a civil fine of up to $1,000 for each willful violation.
Some preschool teachers qualify as exempt from wage and overtime requirements because they are working under the same conditions as their counterparts of elementary or secondary schools. In other words, their primary duty is to teach. Under FLSA, an exempt employee must perform administrative or professional services at least 50% of the time. Problems arise at day care facilities where teaching jobs also include caring for children's physical needs during portions of the work day.
Further complicating matters is the confusion of exempt and non-exempt status among agencies that provide licenses to day care centers. Teachers are classified as exempt when a day care center is licensed by a state's Department of Education. When a division of the U.S. Department of Health and Human Services issues the license, teachers are not considered exempt. Furthermore, the U.S. Department of Labor stated in September 2000 that even when day care centers provide educational services to preschool children, their primary objective is to care for the health and welfare of their children, thus making teachers non-exempt.
Requiring day care workers to attend training sessions on their own time and not paying them, or giving them a flat fee instead of an hourly wage is another issue that falls under scrutiny. Other acts that could be considered violations are not paying teachers to supervise children during lunch, conduct parent conferences, paying a flat fee for overtime or paying proper overtime after 80 hours in two weeks instead of the stated 40 in one week.