Get Ready for 2016 Overtime Regulations

What you need to know… even when you have only 1 employee!

What is “FLSA”?

What is “FLSA”?

Fair Labor Standards Act

Legislation regulating wages and hours

How does it impact overtime pay?

•FLSA defines employees that are:

•“Exempt” from overtime

•“Non-Exempt” from overtime

How does it impact overtime pay?

•FLSA defines employees that are:

•“Exempt” from overtime

•“Non-Exempt” from overtime

Those GET PAID OVERTIME

Who Is Exempt?

• E-A-P are the most common “White collar” exemptions

• Administrative

• Professional

• Executive

Who Is Exempt?

• Must pass the exemption test in 3 parts:

• Get paid on salary basis

AND

• Meet the requirement test (E-A-P)

AND

• Meet a minimum salary test

Who Is Exempt?

• Must pass the exemption test in 3 parts:

• Get paid on salary basis

AND

• Meet the requirement test (E-A-P)

AND

• Meet a minimum salary test

Who is Non-Exempt?

• If an employee doesn’t meet the exemption test, this employee is non-exempt

• Non-Exempt is the default

• 59% of workforce is non-exempt (2015)

MeetJackie

• Assistant Manager• Jackie’s job:• Manages 5 employees • Sets work hours• Hires new employees • In charge of discipline • Covers for her boss• Sometimes works weekends • Answers emails after hours

MeetJackie

• Assistant Manager• Jackie’s job:• Manages 5 employees • Sets work hours• Hires new employees • In charge of discipline • Covers for her boss• Sometimes works weekends • Answers emails after hours

• Jackie’s salary: $45,000 • Jackie is currently exempt

MeetJackie

• Assistant Manager• Jackie’s job:• Manages 5 employees • Sets work hours• Hires new employees • In charge of discipline • Covers for her boss• Sometimes works weekends • Answers emails after hours

• Jackie’s salary: $45,000 • Jackie is currently exempt

This is the type of employee most impacted by the change in “white collar” exemption

White Collar Exemption

Final Rule by the Department Of Labor rule

• Exemption salary raised to $47,476/year ($913/week)

What is changing?

White Collar Exemption

Final Rule by the Department Of Labor rule

• Exemption salary raised to $47,476/year ($913/week)

• Automatic increase every 3 years

What is changing?

White Collar Exemption

Final Rule by the Department Of Labor rule

• Exemption salary raised to $47,476/year ($913/week)

• Automatic increase every 3 years

• 10% salary from bonus and commission

• Effective December 1st 2016

What is changing?

What does this mean for Jackie?

Uncertainty

Jackie’s salary ($45,000) < Exemption level ($50,440)

• Will she remain “management”?

• Will she earn overtime pay?

• Will her income be impacted?

?

What does this mean for Jackie?

Uncertainty

Jackie’s salary ($45,000) < Exemption level ($50,440)

• Will she remain “management”?

• Will she earn overtime pay?

• Will her income be impacted?

It depends on what her

employer decides to do.

?

Meet Henry

• Jackie’s Manager

• He needs to figure out how to prepare for the new overtime regulations

If you are like Henry

• You need to understand the financial impact to your business

• You need to assess your areas of risk

• You want to be prepared for the change

• You want to do the right thing for your business

• You want to be fair to your employees

Help is available

Click here to connect to my free on-demand webinar (with audio!)

In this FREE webinar, you will get:

• A step-by-step action plan to handle your classification changes

• Scenarios and options to consider

• Access to additional resources

Gere Consulting

• FLSA projects

• Policy development

• Job descriptions

• Employee relations

• Management skills

HR projects Training Support Solo HR

• When your HR resigns

• Working on special projects

How We Help Employers

www.GereConsulting.com/product/OTready

Thank you!

www.gereconsulting.com/freeconsult

“Anne-Lise is able to help with the heavy lifting when it comes to designing and implementing big picture HR projects that would otherwise get lost.”-Tiffany Speas, Peninsula Agency of Aging

“Many of the most daunting issues I’ve faced as owner of a quickly growing business are related to human resources. Anne-Lise has provided me prompt, actionable advice and information on several employee issues. I look forward to our continued relationship to support my business.”Dave Hunt – President, Crossrope LLC

Anne-Lise Gere, SPHR