Happy New Year, everyone. Or, as we employment law nerds say, ‘Day 2’ of the new overtime rule today.
(Actually, no one says that except for this nerd.)
As of January 1, 2020, a salaried employee must make at least $684 per week (equivalent to $35,568 per year for a full-year worker) to be potentially exempt from the Fair Labor Standards Act’s (FLSA) minimum wage and overtime pay requirements. The employee must also satisfy the remaining requirements for the executive, administrative, and professional (EAP) exemptions.
Hey, I’ve got an idea! Let’s cue up some Loverboy for the rest of this blog post. I’m sure the new overtime rules somehow coincide with their idea of ‘working for the weekend.’
Wait, where was I? Oh yeah, last year under the FLSA, the enforced salary level for the EAP exemptions was $455 per week ($23,660 per year for a full-year worker). So, if you have salaried employees whom you’ve treated as exempt earning between $455 per week and $684 per week (a/k/a the Tweeners), you’ve got a decision to make.
- One option is to do nothing and clutch your pearls that, when you fail to pay out overtime to the Tweeners for those 40-plus hour workweeks, no one says boo about.
- Another option is to continue to pay the same salary to the Tweeners but limit their overtime opportunities.
- A third idea is to convert your Tweeners from salaried to hourly.
- Alternatively, you can raise Tweener salaries to $684 per week to keep them exempt. Again, I’m assuming that the employee also checks the other EAP exemption boxes.
- Or maybe these new overtime rules don’t affect your business because all of your salaried employees earn at least $684/week already.
I’m curious about what your business down to prepare. And, I’m guessing that other readers are interested too. So, take this poll and let me know. I’ll post the results tomorrow.