We are the industry-leading providers ofemployerservices, everything from payroll to human resources and employee benefits. This publication is for general information and is not to be considered in the same light as official statements of position contained in the regulations. DURABOX products are designed and manufactured to stand the test of time. Drive Your Organization Forward While Empowering Employees, 4 HR Trends to Support Employees in 2023 and Beyond, Amplifying Employee Behavioral Health Through Primary Care. Robinson said it is doubtful the proposed rule will include language to modify the duties tests, but employers should still be vigilant to ensure that the duties tests are not part of the proposed regulations. What is the Fair Labor Standards Act? Virtual & Washington, DC | February 26-28, 2023. The DOL also signaled its intent to revisit the salary threshold for the highly compensated employee exemption, currently set at $107,432. Please log in as a SHRM member. In many cases, the state criteria are harder to meet than the federal criteria. New DOL Overtime Threshold in 2022 United States Department of Labor (DOL) is expected to issue a new proposal for a new salary threshold for several "This type of change will also invite legal challenges since many believe that the level can only be modified vis--vis the normal rulemaking process," he noted. Earnings may be determined on a piece-rate, salary, commission, or some other basis, but in all such cases the overtime pay due must be computed on the basis of the average hourly rate derived from such earnings. While its always a good idea to routinely audit your workforce, the impending new rule presents an important opportunity to zero in on employees whose salaries skirt the current cutoff and decide how they should be properly classified going forward. Your session has expired. ol{list-style-type: decimal;} : If an administrative, professional, executive or professional computer employees weekly salary meets the minimum requirementwhich is $684 per weekthey are exempt from overtime pay. While often regarded as the most important factor determining an employees exempt or nonexempt status, the individuals salary is still only one piece of the puzzle that employers need to consider. Before sharing sensitive information, make sure youre on a federal government site. As a result, employers with 26 or more employees must In rare cases, like Georgia, the state minimum wage is actually lower than the federal minimum. When a state law sets its minimum wage higher than the federal, the state wage applies. .usa-footer .container {max-width:1440px!important;} If you have employees who the government previously considered exempt but dont fall into that category, you can either: First things first, evaluate your options and estimate how much each route will cost you. What was the salary threshold for overtime in 2021? There are some exceptions. WebSalary Basis Requirement To qualify for exemption, employees generally must be paid at not less than $684 * per week on a salary basis. This is calculated by dividing the total pay for employment (except for the statutory exclusions noted above) in any workweek by the total number of hours actually worked. Needless to say we will be dealing with you again soon., Krosstech has been excellent in supplying our state-wide stores with storage containers at short notice and have always managed to meet our requirements., We have recently changed our Hospital supply of Wire Bins to Surgi Bins because of their quality and good price. This blog does not provide legal, financial, accounting, or tax advice. The FLSA requires that most employees in the United States be paid at least the federal minimum wage for all hours worked and overtime pay at not less than time and one-half the regular rate of pay for all hours worked over 40 hours in a workweek. Employers should also take the time to .usa-footer .grid-container {padding-left: 30px!important;} An official website of the United States government. An announcement by the employer that no overtime work will be permitted, or that overtime work will not be paid for unless authorized in advance, also will not impair the employee's right to compensation for compensable overtime hours that are worked. div#block-eoguidanceviewheader .dol-alerts p {padding: 0;margin: 0;} The FLSA also prohibits the employment of a minor in work declared hazardous by the Secretary of Labor. Gain the intel you need now to successfully anticipate and navigate employment laws, stay compliant and mitigate legal risks. The regular rate of pay cannot be less than the minimum wage . Similarly, where an agreement provides for 6 hours pay at $13.00 an hour regardless of the time actually spent for work on a job performed during overtime hours, the entire $78.00 must be included in determining the employees' regular rate. An employer may not deduct from an employees wages for cash or merchandise shortages, employer-required uniforms, or tools of the trade when doing so brings total compensation below the minimum wage or reduce the amount of overtime pay. Required fields are marked *. var currentLocation = getCookie("SHRM_Core_CurrentUser_LocationID"); The employee must be paid a fixed salary that cannot go up or down based on the quantityor qualityof their work. Under the state's exemption for highly technical computer employees, the employee may be paid by salary (at least $865.38 per week in 2022) or by the hour (under a state proposal, the minimum hourly rate would be $28.92 in 2022). Ensuring the salary threshold and duties tests complement one another and that one test doesn't dominate the other is critical to ensure correct classification, he noted. the exempt salary threshold. .h1 {font-family:'Merriweather';font-weight:700;} Isolated or inadvertent improper deductions will not result in loss of the exemption if the employer reimburses the employee for the improper deductions. Sign up to receive exclusive deals and announcements, Fantastic service, really appreciate it. The new rate will take effectJan. 1,2020. If an employee is covered by both federal and state law but doesn't meet both sets of tests, employers should consult with counsel to determine how they should classify the employee in that particular situation. document.getElementById( "ak_js_1" ).setAttribute( "value", ( new Date() ).getTime() ); As organizations and workforces around the world continue charting their course ahead for 2023 and beyond, many are finding that while remote work was sustainable the past two years, it may not be a long-term recipe for success. Newly non-exempt employees may not know how to track hours worked, so make sure they know how to record their working hours properly. Learn how integrated behavioral health rooted in primary care is key to supporting employees mental and physical well-being. Employers should immediately pull data for exempt workers earning below the threshold, attorneys said. Administrative, Professional, and Executive Exemption Minimum Salary, 2. You might consider raising their salary. The new rule will raise the salary threshold to$684a week ($35,568annualized) from $455 a week ($23,660 annualized). [Looking for an updated, easy solution to timekeeping? The .gov means its official. "That is an individual workforce determination that should be made in consultation with HR professionals and outside counsel to ensure compliance with the new rules.". Your email address will not be published. The Act applies on a workweek basis. Virtual & Washington, DC | February 26-28, 2023. Under the Fair Labor Standards Act (FLSA), any employee thats categorized as an exempt employee is ineligible for overtime payeven when they put in more than 40 hours of work in a week. Because many salaried positions are categorized as exempt, they would fall under the overtime exemption umbrellaand, as such, not be entitled to overtime pay. If the administration is serious about getting its changes to survive legal challenges, "the best course would be to be moderate in its approachand quick. Homebase works great for all hourly teams, including restaurants, retail, healthcare, home and repair, and professional services businesses. ", "Employers in certain sectorsespecially food service, retail and other industries where facility managers and assistant managers might meet the duties test but make less than $900 or so per weekshould be concerned once again," Barsanti said. Romn D. Hernndez, an attorney with Troutman Sanders in Portland, Ore., said employers should forecast financial ramifications for changes in labor costs necessitated by changes in the rules. /*-->*/. If state law and the FLSA overlap, the law which is more protective of the minor will apply. Overtime salary threshold limits The U.S. Department of Labor announced their long-awaited update on the overtime rule in September of 2020 and its still in effect. Before sharing sensitive information, make sure youre on a federal government site. [CDATA[/* >