Barring something completely unexpected, the new overtime rules—effectively setting a
federal minimum wage of $913 per week ($47,476 per year) for most
exempt executive, administrative, or professional
employees—will take effect on Thursday, December 1.
Will you raise salaries of exempt
workers to the new minimums? If so, do you still have any
"duties test" risks?
Will you take advantage of your right
under the new rule to use bonuses, commissions, or other incentive
compensation as a credit toward the new salary threshold?
Does your workweek coincide with the
effective date of the new rule (a Thursday), or does it begin, for
example, on the Sunday or Monday before the change? If so, are you
prepared to pay your exempt employees at least $913 for the week in
which December 1 falls?
Will you reclassify some employees to
overtime-eligible? If so, are your communication plans in place?
Are your colleagues in Human Resources, payroll, benefits, and
elsewhere prepared for the change in classification?
If you are reclassifying, are you
ready to manage the potential overtime costs? Do your supervisors
understand what kinds of hours are considered "hours
worked" (e.g., certain travel time, time spent
working from home or remotely, time spent using technology for
business purposes, etc.)?
When will you start counting
"hours worked" if December 1 falls in the middle of your
Have you considered the alternatives
to paying reclassified employees on an hourly basis?
Do you understand what kinds of
compensation will have to be included in the "regular rate of
pay" for overtime purposes?
The USDOL and the plaintiffs' bar are ready for December 1.
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