What are the changes to overtime regulations and how will they affect your business?
The United States Department of Labor (DOL) published the changes to the Fair Labor Standards Act (FLSA) for the overtime rules on May 18, 2016. The job duties of overtime eligibility will remain the same, the thresholds for the salary tests have changed significantly. The new changes will make an estimated 4.2 million additional workers that were not eligible for overtime pay eligible. The changes will take effect on December 1, 2016.
The FLSA overtime changes will apply to your business if you have employees that are paid on a salary that:
Their salary* falls between $23,660 and $47,476 per year and they meet the job duties exemption requirements, see italic information below.
Their salary falls between $100,000 and $134,004 per year and they meet the Highly Compensated Employee (HCE) job duties exemption requirements, see italic information below.
What are the job duties that are exempt from overtime eligibility?
Sometimes referred to as “white collar” exemptions. These are determined by an employee’s specific job duties. Each of these exemptions have their own set of requirements, which can be found on the Department of Labor’s website here.
How can do I need to do to comply with the FLSA overtime changes?
You can start paying overtime to newly
non-exempt employees.
You can increase newly non-exempt
employees’ salaries* to the new
proposed minimum.
Which option is best for your business?
ADP’s calculator that can help you determine which option fits your business and
your labor costs best.
Click Here to go to the ADP Calculator
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