New Rules Affecting Overtime Pay

OperationsInc ALERT: Critical Employment News
New Rules Affecting Overtime Pay and Employee Eligibility

 

Daily Time Record With Blank Payroll Time SheetAfter months of speculation and discussion, the White House announced a major change to the laws surrounding who is eligible for overtime pay. The Department of Labor (DOL) will be implementing significant modifications to the Fair Labor Standards Act (FLSA), with an effective date of December 1, 2016. The key elements of the new regulations and their impact are as follows:

  • Individuals making a weekly salary of $913 (annual salary of $47,476) or LESS will soon be eligible to receive overtime pay. Eligibility determinations will be made in concert with multiple factors, including the nature of the employee’s job, the schooling they have received, and the nature of the business for which they work.
  • Businesses will need to proactively review their employee population to determine who MAY be deemed affected by this law change, and then determine which course of action makes the most sense for them to follow. The options include:
    • Raising the salary of those affected to a level greater than the $47,476 threshold.
    • Paying overtime to those affected starting 12/1/2016.
    • Limiting the hours of those affected so as to ensure they do not exceed more than 40 hours worked in a given week (or in some states 8 hours in a given day).
  • Again, employers have until 12/1/16 to assess their options and implement a plan designed to address these changes.

A wide ranging FAQ document, covering these key points + other changes, has been posted by the DOL at https://www.dol.gov/WHD/overtime/final2016/faq.htm#G1.

In the coming weeks, OperationsInc will be announcing the following:

  • A 1-hour webinar focused on the changes to the law, the definition of how comply, along with strategic advice on how best to fulfill your firm’s obligations while creating minimal impact and disruption.
  • A new FLSA Assessment Service, providing a team to audit your practices, along with expert advice and input on your firm’s specific potential issues and a path to most effectively address them.

In the interim please feel free to reach out with your questions by contacting us at 800-307-5513 or at info@OperationsInc.com