It is virtually a certainty that the Department of Labor will in 2016 enact its proposed new Fair Labor Standards Act (FLSA) regulations. One key change that will adversely affect all or almost all employers will be which employees will continue to qualify as being classified as “exempt” from overtime pay.
- It is estimated that almost 5 million employees who are currently exempt will become eligible for mandatory overtime pay.
NOW
There are two parts to the test to determine whether or not an employee meets the qualifications to be classified as exempt.
- Salary
• The salary must be $455 per week ($23,660 per year) or greater.
• The government’s contention is that this threshold is far too low. - Duties
• Using the nature of the work (for example, how much independent judgment is involved) & the amount of time employee engages in various duties
NEW
The duties test will not change, but the compensation minimum is increasing dramatically.
- A minimum of $970 per week ($50,440 per year)—more than 2x the current threshold.
Employers who now treat as employees as exempt but they make less than $50,440 will have 2 options — both of which will increase labor costs:
However, one should always consume generic levitra online only under a certified doctor’s recommendation as it is important to have idea about the health factors it can affect as much as 10 percent of the male population at some point in their lives.
- Increase their salary to this minimum level
- Re-classify them as non-exempt and begin paying them at time and ½ their regular rate of pay for all hours worked in excess of 40 in any given week.
RECOMMENDED EMPLOYER ACTION
- Make sure you have a formal, written process in place to determine in a position truly qualifies as exempt based on the duties and salary tests—and the process includes identification of which of the FLSA’s multiple exempt categories is met.
• If you don’t have a process in place, establish it now.
WHY THIS STEP?
• The Department of Labor has already increased its FLSA compliance audits, and it is expected to increase its enforcement efforts. - Do an analysis to determine which employees currently treated as exempt make less than $50,440 and how many hours are they working more than 40 in a given week.
• This analysis will enable you to calculate the financial impact.
HOW TRINITY CAN HELP
Trinity’s Team has the experience and expertise to provide assistance expertly and affordably.
- For more information, e mail Trinity at info@TrinityHR.net or visit our website at www.TrinityHR.net.