IntroductionThe purpose of this research paper is to examine compensation challenges and trends in the public sector from an interdisciplinary view of local agency human resources, state and federal. Human resource management in the public sector continues to encounter many challenges in an ever-changing workforce. Through the stages of the employee life cycle, HR managers are required to keep compensation at the forefront of forming a strategic organization. Of these challenges, budget cuts, impacting pension plans and tenure, are some of the areas of HR concern among government agencies. The nature of the work provided by public agencies makes it imperative that policies and procedures are defined and universally compliant with government regulations. Using guiding principles of government practices along with history, the public sector continues to encounter challenges in balancing compensation and benefits for its employees. ReadHuman resources professionals must learn and understand all aspects of public sector employee relations. Among these regulations, laws related to fair pay practices are particularly important. The Fair Labor Standard Act, passed in 1938, established standards related to minimum wage, recordkeeping, overtime pay, and youth employment (U.S. Department of Labor, 2014). Both state and local agencies must comply with this standard following the decision in Garcia v. San Antonio Metropolitan Transit Authority (Klinger, Nalbandian, & Llorens, 2010). This decision made it possible for employees, excluding exempt professionals, to be paid time and a half for overtime. One challenge many agencies face is recordkeeping. This maintenance of employee pay records is… middle of the paper… the role of the profession on public sector pay. Public Administration Review, 73(1), 8-9.Southern, C. (2013). Awards and recognition: The competitive advantage of public sector organizations. Human Resources News Magazine. Retrieved from http://ipma-hr.org/sites/default/files/March2013Southern.pdfStoeckmann, J. (2014). Facts and errors related to total compensation in the public sector. Palestinian Authority Times. Retrieved from http://patimes.org/facts-and-fallacies-of-total-rewards-in-the-public-sector/Sun, Salaries and Public Employees; pay in the public sector. (2011, March 5). The Economist, 398(8723), 81(USA). Retrieved from http://go.galegroup.com/ps/i.do?id=GALE%7CA250488069&v=2.1&u=lom_cmichu&it=r&p=STND&sw=w&asid=c396c7499dc46e5147ce457dc97b3326U.S. Department of Labor. (2014). Wage and Hour Division (WHD). Retrieved from (http://www.dol.gov/dol/aboutdol/history/flsa1938.htm