Does the Fair Labor Standards Act (FLSA) apply to our ministry?

The Fair Labor Standards Act (FLSA) applies to your ministry if the government considers it to be an “enterprise.”

The FLSA outlines how employers must pay workers who are subject to the act’s requirements. If your ministry fits the government’s definition of an “enterprise,” it must follow the FLSA’s minimum wage and overtime pay requirements for all employees.

Generally, the federal government doesn’t consider churches to be “enterprises,” since employees aren’t performing a “business purpose” within the law’s meaning. However, the requirements of law may still apply to employees individually, even when a church is not an “enterprise” under the FLSA.

Individual Coverage May Apply to Some Employees

If the FLSA doesn’t apply to your ministry as a whole, some of your employees may still be covered by the law under Individual Coverage. These employees are entitled to earn the federal minimum wage, plus overtime pay, if they work more than 40 hours in a week.

The U.S. Department of Labor’s Wage and Hour Division evaluates Individual Coverage under FLSA on a case-by-case basis. In each case, regulators determine whether or not the individual employee is “engaged in interstate commerce” on a “regular and recurrent” basis. “Interstate commerce” is defined broadly enough to include interstate telephone calls, interstate mail, and ordering or receiving materials across state lines.

There’s no clear definition of what “regular and recurrent” means. The Wage and Hour Division says it will investigate each situation individually.

Keep in mind that nearly all ministries are covered by the FLSA, based on business or individual employee considerations. Ministry leaders should seek the counsel of a local attorney and a certified public accountant in making decisions about the ministry’s compliance with FLSA and its record-keeping and filing requirements.

Recommended Resources

If you found this information helpful, you might be interested in these other resources from Brotherhood Mutual:

The information in this article is intended to be helpful, but it does not constitute legal advice and is not a substitute for the advice from a licensed attorney in your area. We strongly encourage you to regularly consult with a local attorney as part of your risk management program.


New Overtime Rule Changes for 2020

You could claim up to $33,000/employee with the
Employee Retention Credit.

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