CPP Wage & Hour Laws 5

Question 1

Which enforcement agency is responsible for administering the FLSA's wage and hour provisions?

Accepted Answer

Department of Labor Wage and Hour Division (WHD)

Answer

The Wage and Hour Division of the U.S. Department of Labor investigates, enforces, and administers FLSA minimum wage, overtime, and child labor requirements.

Question 2

An employer discovers it has underpaid an employee's overtime for the past 18 months due to a non-willful error. What is the maximum back pay period the WHD can recover?

Accepted Answer

2 years

Answer

For non-willful FLSA violations, the statute of limitations is 2 years, so back pay recovery is limited to the 2 years preceding the filing of the complaint.

Question 3

Which of the following business types is NOT automatically covered by the FLSA under 'enterprise coverage'?

Accepted Answer

A sole proprietor lawn care business with annual sales of $200,000

Answer

Enterprise coverage requires annual gross sales of at least $500,000 (or operation in certain industries); a business with $200,000 in sales does not meet the threshold.

Question 4

A retail store claims the retail or service establishment exemption from FLSA overtime for a commissioned salesperson. Which condition must be met?

Accepted Answer

More than half the employee's earnings must come from commissions and the regular rate must exceed 1.5x minimum wage

Answer

Under FLSA Section 7(i), the retail/service exemption requires that over 50% of compensation comes from commissions and the regular rate exceeds 1.5 times the applicable minimum wage.

Question 5

Which of the following payments is EXCLUDED from the FLSA regular rate of pay calculation?

Accepted Answer

Discretionary bonuses determined at the employer's sole discretion

Answer

Discretionary bonuses—those not promised in advance and whose amount is determined solely by the employer—are excluded from the regular rate under FLSA Section 7(e)(3).

CPP - Certified Payroll Professional Practice Test

CPP - Certified Payroll Professional Practice Test

CPP Wage & Hour Laws 5