Skip to Main Content

4 Things Employers Should Do Now That the Proposed Overtime Rule for White Collar Workers Has Been Announced by the Department of Labor

4 Things Employers Should Do Now That the Proposed Overtime Rule for White Collar Workers Has Been Announced by the Department of Labor - Michigan Human Resource Consulting Blog | Sage Solutions Group - Background
It is hard to forget the scrambling that occurred at the end of 2016 to prepare for the anticipated minimum salary increase for salaried-exempt white collar workers from $23,660 to $47,476. The new ruling was scheduled to go into effect on December 1, 2016 but was struck down days before the deadline. Those who were watching the courts closely knew they needed a plan to prepare should the ruling hold, but they waited before making a move. Those who were not, may have adjusted their salary minimums to only learn that the rule was struck down. This decision could have been very costly, or worse yet, the employer may have taken the salary increase away; potentially harming employee relations.

Fast forward to March 7, 2019- The “Department of Labor announced a proposed rule that would make more than a million more American workers eligible for overtime” (DOL.gov). The overtime regulations have been under review by Secretary Acosta and his team and they finally released the proposed salary minimum from the Department of Labor.

The newly proposed salary minimum for most exempt employees is $35,308. That is actually a bit higher than expected, but much lower than 2016. Currently, most employees you consider exempt from overtime must be paid more than $23,660 annually.  Should the proposed new minimum go into effect, exempt employees must make more than $35,308 annually or their status must be adjusted to an hourly non-exempt position. Employers may use bonuses or commission to satisfy up to 10% of the new minimum level. Overtime protections remain unchanged for police officers, firefighters, nurses, laborers and construction workers, to name a few (DOL.gov).

Additionally, this new proposed rule making increases the total annual amount for highly compensated employees from $100,000 to $147,414. 

What happens now?

There is a mandatory 60-day public comment period, after which the final regulations will go into effect. It is unclear exactly when/if this new rule will go into effect, although we have heard late fall or early 2020.

Here are 4 steps employers should consider:

  • Audit your exempt classifications.
  • Ensure that the employees currently receiving an exempt salary are truly exempt.

  • Review employees that are earning an exempt salary in the range of $23,660 and $35,308 to determine how you want them paid in the future.

  • Develop an action plan and implement it once the rule goes into effect.  Remember do not act too quickly as this is simply a proposed rule at this time!

 

Should you need more clarification regarding this or any other HR matter, contact Sage Solutions Group at 734-855-7187 or visit us on the web at www.sagesolutionsgroup.com. Sage offers a free HR audit to assess your current HR health, call now to schedule!

6 Key HR Issues for Small Businesses

  Most Common HR Mistakes for Small Businesses:   #1    FAILURE TO COMPLY WITH MIOSHA Although most reporting requirements through MIOSHA start with 11 or more employees, a small business is required to...

6 Tips to Help Improve Your Cybersecurity

We all know the importance of cybersecurity these days, but the phishing attempts and other scams have gotten increasingly hard to detect.  Cell phone numbers are even being targeted where individuals are receiving text messages that appear to...

A Time To Celebrate. But!

Michigan will open on June 22nd to full capacity and the mask mandate is no longer required for residents.  YES!  It has been a long hard road for most all businesses.  Time to rip off that mask and celebrate?  Not so...

How to Lose Thousands of Dollars in Just One Day

The year 2021 is already proving to be a complex one for business owners.  There’s extended closures, new laws and rules to consider, PPP round two, and last but certainly not least, extremely sophisticated hackers looking to steal your...

COVID-19 Pandemic: Return To Work Plan

8 Tips for Bringing Your Employees Back to Work Safely and Successfully Now that more and more businesses are re-opening, it's important to understand how to safely bring your employees back to work. Here are 8 tips to keep in...

The New Form I- 9- What You Need to Know

  As of January 31, 2020 the Department of Homeland Security- U.S. Citizenship and Immigration Services announced the release of the new version of Form I-9, Employment Eligibility Verification. While this form is ready for...
Page: 1234 - All
734-238-3504