October 23, 2017

The Overtime Rule

One more reminder, if you have a for profit or a not for profit business in the USA, this DOES affect you.

The Department of Labor, United States of America, The Overtime Rule

In 2014, President Obama directed the Secretary of Labor to update the overtime regulations to reflect the original intent of the Fair Labor Standards Act, and to simplify and modernize the rules so they’re easier for workers and businesses to understand and apply. The department has issued a final rule that will put more money in the pockets of middle class workers – or give them more free time.
(Note: this is not a law that will be discussed and/or voted upon. It is a mandatory ruling that has already taken place and ALL employers must comply on or before December 1, 2016.)

The final rule is:

  • Raise the salary threshold indicating eligibility from $455/week to $913 ($47,476 per year), ensuring protections to 4.2 million workers.
  • Automatically update the salary threshold every three years, based on wage growth over time, increasing predictability.
  • Strengthen overtime protections for salaried workers already entitled to overtime.
  • Provide greater clarity for workers and employers.

The final rule will become effective on December 1, 2016. The final rule does not make any changes to the duties test for executive, administrative and professional employees.

This ruling does NOT make exceptions for non-profit organizations (churches, schools, charities, etc.) All salaried employees currently earning below $47,476. per year must either raise the salary and keep the employee exempt, pay overtime in addition to the employee’s current salary, or evaluate and realign hours and staff workload.

Click here to read further about the final rule for non-profits:

https://www.dol.gov/sites/default/files/overtime-nonprofit.pdf

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