Seasonal Businesses and the FLSA
In response to the effect of COVID-19 on seasonal businesses, the U.S. Department of Labor will issue a temporary reprieve to these seasonal businesses against the Federal Fair Labor Standards Act (FLSA) minimum wage and overtime violations. Many of these businesses were forced to adapt their day-to-day operations because of the pandemic. Resultingly, many seasonal businesses were made ineligible for the seasonal exemption due to these necessary adaptations.
Changes due to the Pandemic
Businesses that have had to change their operations due to the pandemic are, according to a Law360 article, “those business that are only open for seven months a year or less or whose income fluctuates dramatically at different points in the year.” Such seasonal businesses include amusement parks, golf courses, stadiums, and camps, whose ability to remain open and offer services is highly dependent on the weather and/or (especially for camps) the summer term of the school year. Again, these businesses will benefit from non-enforcement of FLSA minimum wage and overtime violations that may even continue into 2021 should the pandemic, and its dampening economic effect, persist.
Companies that have had to adopt alternatives to their usual operations will be those benefited by the non-enforcement of such FLSA claims for the time being. However, with the benefit of this non-enforcement, a few factors must be met for it to apply to a seasonal business.
Factors to Consider
In order to enjoy the advantages the DOL is offering, businesses must have either been an exempt seasonal operation before 2020 or one that had already implemented plans to become an exempt seasonal operation before the start of that year. Additionally, the businesses must put in place a plan to resume regular business in 2021 while maintaining their pre-pandemic wages.
All of these changes have been implemented by the DOL in an effort to mitigate the harsh impact that the pandemic has had on businesses, mainly seasonal ones. With the implementation of the non-enforcement of such claims for the time being, the DOL hopes to ease the burden that such employers have had to face until the levels of such operations can adjust to their normal, pre-pandemic positions.
– Jacob Mikalov for Barkan Meizlish, LLP