Overtime in Election Offices

Bill Gilkeson

NC Association of Directors of Elections

April 10, 2017

Current Law – US Fair Labor Standards Act (FLSA) – US Dept of Labor regulations• Employees must be paid time and a half for any hour they work over

40 hours a week. . .

• unless an exemption applies. . .

• or unless employers choose an alternative to overtime pay.

Exemption 1

• If employee is salaried and

• Meets the administrative duties test or the executive duties test orthe professional duties test and

• Makes at least $455 per week or $23,660 on an annualized basis.

Exemption 1 (continued) - Definitions

• “Salaried” – paid a predetermined amount for each pay period without any reductions due to the quantity or quality of work done.

Exemption 1 (cont.) - Definitions

“Administrative duties test” – 2 elements:

1. Employee must have a primary duty of office or nonmanual work directly related to management or general business operations of the employer and

2. Employee must perform work requiring the exercise of discretion and independent judgment on matters of significance to the employer.

Exemption 1 (cont.) -- Definitions

“Executive duties test” – 3 elements:

1. Employee must have the primary duty of management of the organization or one of its recognized departments or subdivisions, and

2. Employee must customarily and regularly direct the work of two or more employees and

3. Employee must have the authority to hire or fire other employees, or have his or her recommendations as to hiring, firing, promotion, or other change of status be given particular weight.

Exemption 1 (cont.) – Definitions

“Professional Duties Test” – 2 alternatives -- Employee must have a primary duty of performing work that requires:

• Knowledge of an advanced type in a field of science or learning that is customarily acquired by a prolonged course of specialized intellectual instruction or

• Invention, imagination, originality, or talent in a recognized field of artistic or creative endeavor.

Exemption 1 (cont.) – DefinitionsTypes of professional jobs that fit the “Professional Duty Test”

“Learned Professional” – 3 elements:

1. Employee must perform work requiring advanced knowledge, and

2. The advanced knowledge must be in a field of science or learning and

3. The advanced knowledge must be customarily acquired by a prolonged course of specialized intellectual instruction.

“Computer Professional” – employee’s work must focus on one or more of 3 technical endeavors. A computer professional does not have to be salaried to be exempt.

To Recap Exemption 1

• If employee is salaried and

• Meets the administrative duties test or the executive duties test orthe professional duties test and

• Makes at least $455 per week or $23,660 on an annualized basis.

Exemption 2 – “Highly Compensated Employee Exemption”• If salaried employee does not meet any of the “Duties Tests”

• But is paid more than $100,000 a year,

• That employee need not be paid time and a half for overtime.

The 2016 Rules Change & Nevada v USDOL• In May 2016, the US Dept of Labor issued changes to the overtime rules, to be

effective Dec. 1, 2016.

• The minimum salary for Exemption 1 was raised from $455 a week to $913 a week, annualized from $23,600 to $47,476. A little over 100%.

• The minimum salary for Exemption 2 was raised from $100,000 to $134,004 a year.

• Both minimum salaries were to be inflation-adjusted every 3 years.

• Employers could include nondiscretionary bonuses up to 10% of the minimum salary level.

• 21 states (not NC) challenged the rule change in US Dist Court in Texas.

• In November 2016, judge blocked the rule with a preliminary injunction. Said USDOL lacked statutory authority to set salary minimum or 3-year adjustment.

• Obama Administration leaves, Trump comes in.

• Up in the air.

Alternatives to Conventional Overtime Pay

Comp Time –

• Available to government employers only.

• If offer comp time instead of overtime pay, there must be 1.5 hours of comp time for every overtime hour worked in a week. Hour for hour comp time violates federal law.

• May be offered uniformly or employee-by-employee, or only for certain special assignments.

• Employee must have agreed to comp time before overtime hours are worked.

• Employee can accrue no more than 240 hours of comp time, but public safety, emergency response, or seasonal activity employees get 480. After that, overtime must be paid in cash. Employer may set lower limits.

Alternatives to Conventional Overtime PayThe Fluctuating Workweek Method – paying half, rather than time and a half, for overtime hours worked in a week.Five Requirements:1. Employee must work hours that fluctuate from week to week.2. Employee must be paid a fixed salary that covers all the hours worked in

the week.3. The employee & employer must have a “clear mutual understanding”

that the fixed salary covered all the hours worked. (Not the same as consent.)

4. The fixed salary must cover all the hours worked at at least the minimum wage.

5. For every hour over 40 worked in a week, the employee must be paid half the regular rate.

The theory is that the fixed salary takes care of the “time” for the extra hours, so all that is left to satisfy the overtime law is the “and a half.”

Who decides?

• County commissioners, since elections board employees are county employees.

• But – GS 163-37 gives county commissioners the duty to “appropriate reasonable and adequate funds necessary for the legal functions of the county board of elections.”

• And -- NC Court of Appeals in Graham County BOE v Graham County Commissioners, 212 NC App 313 (2011) allowed the BOE a writ of mandamus to force the county to pay for an employee.