If your company has managers who are paid less than $50,000 a year and are exempt from overtime, then it’s time for you to play “what if…?” What if those managers became eligible for overtime because new overtime laws require that they be changed to non-exempt status? Now is the time for you to look at your numbers, your budgets, and the tasks your employees are actually performing.
The DOL will revise the FLSA exemptions for executive, administrative and professional employees. Since 2004 FLSA limits have said that these white-collar employees paid salaries of less than $455 per week/$23,660 per year automatically qualify for overtime pay. It is expected that the re-write will change the salary base to between $40K and $50K a year. That will likely mean that many of your exempt employees will become non-exempt when the new overtime ruling takes effect. The new ruling is expected to take effect in August 2016.
Additionally, if you were depending on the old “duties” test to qualify your employees as exempt from overtime, that is getting a makeover, as well. Expert analysts expect the new legislation will be much more employee-friendly, perhaps calling for an employee to be eligible for overtime unless they spend over half of their work week performing managerial tasks.