Don’t Fear the DOL’s Proposed New Regulations
I’m sure I’m not alone in having worked more than 40 hours a week a time or two. But as a salaried employee, I don’t earn extra money if I stay late or go in early. However, that may change for some of your employees under new U.S. Department of Labor regulations affecting white-collar exemptions. The DOL are reviewing comments from employees and employers about the proposed changes that would increase the minimum salary of certain employees, but here’s what to remember: it all comes down to the job description and tasks, not the title.
Currently, to qualify for an executive, administrative or professional (EAP) exemption from overtime, employees must: be paid on a salary basis; be paid at least a fixed minimum salary per week; and perform job duties that qualify for the claimed exemption. (Other exemptions exist, but these are the basics.)
According to an article in The Business Journals, new regulations that the DOL are proposing could increase the minimum salary for the EAP exemptions from the current $455 per week (about $23,600 a year) to (projected) $921 per week (about $47,900 a year). The new salary amount, based on data from 2013, represents the 40th percentile of weekly earnings for full-time salaried workers, and the DOL projects that the salary would actually be $970 per week (about $50,400 a year) in 2016, when final regulations would likely take effect.
But what brought on these changes? The DOL felt that employees in lower-level management positions may be classified as exempt even though they spend a significant amount of time performing nonexempt work. The Department cited California’s requirement to spend more than 50 percent of one’s work day performing exempt duties to retain that classification.
Manage their time and tasks and, at the end of the day, don’t be afraid of these changes — just be sure to classify your jobs correctly and pay your people accordingly. Visit stopknockingonmydoor.com to schedule your free consultation and to learn more about correctly classifying your jobs.