FLSA Overtime Exemptions: Big Changes Coming for Salaried Employees
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- Опубліковано 4 лип 2024
- Is YOUR Salary About to Change? The Department of Labor's (DOL) final rule on overtime exemptions increases minimum salary requirements for white-collar workers. A pivotal change set to take effect on July 1, 2024. These regulations will dramatically alter the salary threshold for exempt employees, impacting countless workers across the United States, including those like Sarah, who balances intense work periods with cherished personal time.
In this episode, you'll:
Understand the New Overtime Rule: What the increased salary threshold means and how it affects both employees and employers. The new salary requirements go into effect July 1st and January 1.
Real-Life Impact: Explore how these changes will reshape the work-life balance for employees like Sarah, who find themselves juggling between professional responsibilities and personal engagements.
Practical Strategies: Gain insights into how businesses can navigate these changes effectively without disrupting their operations or compromising employee satisfaction.
Expert Advice: Equip yourself with knowledge and strategies to ensure compliance and maintain efficiency in your workplace.
Whether you're an employer wondering how to adjust salaries and manage labor costs, or an employee concerned about how these changes might affect your work arrangement and income, this episode is packed with essential information to help you prepare for the upcoming changes.
🔗 Check out our website for more resources and assistance: peopleprocesses.com
👍 Like, comment, and share this video to help spread the word about these crucial updates!
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#FLSAOvertimeRule #salarythreshold #HRCompliance #WorkplaceAdaptation #PeopleProcesses #fypシ
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for 20 years i was a salaried worker exempt from overtime despite putting in 50+ hour weeks. Then corporate decided to save money by making us hourly as it slightly reduced our benefits. I said: Thank You as my income went up about $50,000 a year. My pension was based on my total income so during the last 21 years i worked for the company my pension also took a big jump.
Thanks for the comment!
Minimum salary plus overtime *is* a great solution.
We're all overworked and underpaid.
Thanks for the comment!
You lost me at 43000 a year. I'm not getting out of bed for that. The people making pulled pork at buc-ee's make more than that.
Dude, I said the same thing. That’s barely scraping by in South Dakota, let alone a place that isn’t a shithole
Hah! I hear you =). Still, 35% of salaried employees in the south make less than 58K a year. So its going to affect a lot of people =)
Thanks for the comment!
If your family needs food and shelter, you do what you gotta do.
Welfare king
This was very helpful and clearly explained! Thank you!
Thank you very much Melany! Let me know if you have any questions, or ideas for future videos. I'd love to help!
@@peopleprocesses I think it'd be cool if you could do a video to further break down the benefits and tradeoffs of each employee classification that you explored at a high level during this video.
Looks like remote work without clocking in is going to get really popular..
Maybe! Thats one of the bigger issues. If someone is NOT FLSA exempt (hourly with overtime) you HAVE to pay them for all time "suffered or permitted to work". If an employee works from home without clocking in... they would be entitled to back wages, late penalties, all kinds of nasty. And they can't just "waive it." If the employee changes their mind in a year or two... you are gonna hear from Morgan and Morgan or some other ambulance chaser!
We have salary non-exempt employees and that approach is wholly taken advantage of by said employees.
yeah, its a dangerous situation to get into! Definitely need strong performance management. Ive seen groups where lots of work gets "batched" for end of month on Salary exempt... "We had to work overtime this week because the month end close..." etc...
I'm curious where you've met a salaried person who works less than 40 hours in the off season. Generally management staffs correctly for the offseason and just pressures unpaid overtime from their workers during high-workload time, or maybe brings on seasonal help.
Hey AAA! No, doubt, many businesses do that =). Still, I see many businesses where the cost of bringing on labor for the "busy" times in a crunch exceeds maintaining the talent consistently throughout the year. Primarily in industry where "higher skill requirements" results in heavy competetion for talent. Schools are a simple example, but iv seen this in restoration and construction businesses (Remember, we are talking salary people), retail, hospitality, medical (yes, did you know lots of medical is seasonal? Deductibles are a real thing).
Anyway, it just depends on the company and industry. Thanks for the comment!
@@peopleprocessesYou missed their point that salaried workers almost invariably work overtime year round.
My salaried job fluctuates. OCT TO JAN is peak brutal long hours. Then it slows the rest of the year. Some of us work 30 hrs or less during the slow time. But at peak time, 60 hrs or more.
About damned time.
I got caught up in the "independent contractor" scamming of the 1980's for sales people like me.
Then there's the "temporary worker" scam using contract or third party companies.
Business loves to take advantage of those who make the business work.
Thanks for the comment!
Depends though! When the economy is bad; salary is good.
When it's good; hourly or commission is good.
Currently the economy is extremely bad lol
Going hourly would be suicide for most people right now; as those hours would be cut.
If you get a pay bump without question to the new minimum, chances are you are still underpaid.
Hah! Thanks for the comment =)
I love the idea of non-exempt salary. For IT people/data center techs especially.
Thanks for the comment!
Is the 58,000$ a year going to be including commissions and bonuses or just what your flat salary rate is cause almost a third of my paycheck is incentive based.
How do you recommend handling the morale change when moving longtime exempt employees to hourly?
Hey @tf2121x - Good question! Two broad ideas: 1 - "its a new regulation, just is what it is, silly gov't". lol. OR, my preferred... make everyone clock in, even remaining exempt employees. Its good data to have, really important to combat burnout and reward your hardest workers (or ID those who are screwing around), and will help morale if "everyone" does it, even execs.
Does this affect public school education? For example all teachers are salary based at my school. Is the district at my school now required to raise what they are paying teachers, or move them to an hourly based payment system?
A teacher is exempt if his or her primary duty is teaching, tutoring, instructing, or lecturing to impart knowledge, and if he or she is performing that duty as an employee of an educational establishment. Educational establishments include elementary school systems, secondary school systems, institutions of higher education, and other educational institutions.
If a bona fide teacher meets this duty requirement, the salary level and salary basis tests do not apply.
That means you are likely not affected by this Valortjd!
@@peopleprocesses Thank you!
This is a frustrating new rule! I work at a small university as a licensed professional. Been here 15 years and love my job. My position is 10 months (Aug-May) and having summers off have been a huge perk. Having to "clock in" will be annoying and I can definitely see how employees will be prevented from working overtime. My concern is what happens to my paycheck during the summer months when I am off, once I go hourly? Currently, my salary is spread over 12 months even though my contract is 10 months. I hope there is a way my employer can still pay me over the course of 12 months even though I'll be hourly. I wish there was an option from FLSA to opt in/out for exempt/non-exempt if you're under the threshold - especially for many like me who have positions where working overtime is not an issue.
Hi Indiana! Thanks for the comment. You mentioned a "licensed professional." You may want to take a look at www.dol.gov/agencies/whd/fact-sheets/17s-overtime-educational-institutions as teachers and other learned professionals in Medicine and Law dont have to meet the minimum salary basis test described in the video above.
@@peopleprocesses so I work as a clinical counselor at a college counseling center. I suppose I would be considered "professional" according to the FLSA since I provide services to students as a licensed counselor. If so, would this mean I could carry on as a full-time exempt salaried employee even though I will lie below the threshold?
I have worked voluntary OT because unexpected events do happen and I believe it is worth it to help the whole team succeed and save all of our jobs. However I do not accept salary limit for getting paid mandatory OT. I don't work for free by force. Keep separate signed paper copy of your time because employers prevent you from entering mandatory overtime on online timesheets and make sure your report mandatory OT worked to your manager and you have copy of that communication. Employee has option to demand pay or leave. Stand up for yourselves.
Thanks for the comment!
About time. Employers have cheated employees on overtime for eons by not allowing full overtime payout levels.
Thanks for the comment JA!
No, it will backfire. The economy is really bad right now and going hourly will probably result in having a lot of 'hourly cuts'.
@@vladimirofsvalbard9477 We will see! Im sure there will be lots of analysis as this rolls out.
@vladimirofsvalbard9477 Ceos still making 50% more so that doesn't make sense
So what is the limitation on this? Are employers allowed to decrease the employees pay if they move them to hourly?
Hi Jessica! If they are paid hourly (with overtime, minimum wage, etc...) and there is not a contract stipulating otherwise, then yes, an employer can change wages. Doesnt mean the employee has to accept it of course, but they can cut wages.
Are there any exemptions for non-profit organizations?
@brandon, No sir. No difference in For Profit Vs Non Profit on this one =)
Many of my friends in software have salaries, they take many vacations,or daily naps and so on, barely working hard. That is why we saw so many stories when people working at home take two jobs, making big...
Thank you for your comment!
Won’t most employers just make these employees hourly and not allow overtime? Nothing over 40 hours
Im sure that will be the result in many cases. That may be rough for some people used to the consistency of salary. Salary positions often lack the "supervision" of the clock that many hourly positions have built in. Sometimes that benefits the employee, sometimes the employer. Thanks for the comment!
Yep
What will be the number they use in 3 years?
So that rule says every three years they are to reset the minimum salary to be equal to the "35th percentile of salary of the lowest cost census group". Thats the southern USA. Obviously, after this change, that number is going to change a LOT. It's unclear what that would mean in dollar terms three years from now, and whether another administration would follow that rule. In general though, you can expect AT LEAST a 10% increase in this in 3 years. Could be much higher, depending on inflation, and how the new admin interprets the rule.
All our 40 hour people were forced to work overtime . Sure they got paid overtime, but it burned out people and they would quit. The hours were long and the work was exhausting. It went on for years. They even did this to part-timers. I quit. The money wasn't worth the damage it did to my body. The medical bills defeated the whole purpose of creating wealth. The long term damage is irreversible.
Thanks for the comment Brenda!
What about highly compensated employees $107k
Time is really money.
Thanks for the comment!
I live in texas. Im an assistant manager making 40,000 a year and my boss makes me work 66 hours a week. Im explioted.
Welp! Starting July 1 they can raise you to ~44 or start paying overtime! =)
Thanks for the Comment!
Its called work will be RESTRICTED to X Hours only. Companies hate paying overtime, this will be an FING Disaster!
Thanks for the comment. Moving to hourly and heavily limiting overtime is definitely a core strategy being discussed.
Thanks for this video.
Wow! As someone that has worked salaried for the past few years and has managed hourly employees, this sounds like a pain. Everywhere I've worked they wouldn't have given me a raise from $40k to $58k. And from a management perspective, managing and approving time cards took more time than I would have liked on a weekly basis.
Its gonna be rough, and not much time to decide! Luckily the BIG jump is in January, so we can plan. Best of luck, and thanks for the comment!
Inflation about to hit all time Highs.
Thanks for the comment!
Overall comment: Keep acting like anybody on salary ain't' working at least 45 hours a week, minimum. @4:40 - you really gonna sit there and act like Sarah don't have to burn PTO, comp, vacation, etc time if she don't hit 40 hr/wk on hourly. Where do you work? @5:07 - Nowhere is a salaried position getting overtime, but almost ALL of them have to punch a time clock or do a time sheet for billing. Cry more. Rest of the video - oh. This clown is a HR consultant to private firms. I can see why he's extra "concerned" about this. Yeah brah. Your clients are gonna take it in the pants. I don't have a problem with that. My poor southern ass can't afford McDonald's on my "salary."
Yay! My first pretty negative comment. Getting to the big leagues, lol. Thanks the for comment.
@@peopleprocesses buhahahaha
So before July 1, 2024…the equivalent of roughly $18 or so…. AFTER July 1, 2024…$22.81. WOOHOOO !
And then a very large jump in Jan! Thanks for the comment =)
$43888 annual salary is roughly $844/wk…with average tax rate you’ll take home roughly $560 …. WOOHOO!!!! So generous of the brain dead overseers to allow for this
Thanks for the comment
The solution will be to keep Sarah's pay rate the same, but switch her over to hourly and limit her to 39 hours a week. This way you can work her like a full time employee, but deny her full time benefits, because she's not doing 40 hours a week and thus saves the company money. This is what GameStop used to do and it's super shitty. The other thing that could happen is the company could fire Sarah and replace her with 2 new part time employees who both work for less than she did and are each limited to 20 hours a week. This would keep productivity up in theory and still save the company money. It's also super shitty. The other thing that could happen is the company makes Sarah hourly at her current pay, makes her clock out for the week at less than 40 hours, but still expects her to do the same 40+ hours of work a week she was doing before. Then they fire her if she doesn't, because she hasn't met her goals. But who am I kidding? No company out there would do such a thing.
Yeowch Cerza. Sounds like a rough time! Thanks for the comment =)
"Fast growing tech company", yeah, WHERE? Not this planet. Sounds like another job killer.
Thanks for the comment
I work 40 hrs on salary exempt. Im 41 working in same position for 5 years. If they keep me on salary exempt and I get the increase I will be making the same as every other minimum wage salary person. What happens to all my time I put in....I make 55K now and It would be nice to get 58k come January but so will everyone else. All my skills, efforts and time on the job mean nothing anymore...What do I do with that?
This is the idea of "Salary Compression," and happens when the floor wages of a role are increased. In general, increasing the minimum salary has broader implications, where you have to also provide commensurate rates to more senior employees and managers.
Assuming your organization already has reasonable "steps" in increased wages for tenure or leadership, then if the "floor wage" for the role is going up by 10%, then you would likely need to raise senior positions by a similar amount to reward longevity and leadership.
This seems outdated. Most salaried employees make more than this.
Thanks for the comment!
what rock did you come out of
Definitely not true especially in the south 😕
Employees are gonna lose. Big time.
Thanks for the comment!
Thanks for your propaganda!
@@VulcanLogic - I’m not sure you know what the word “propaganda” means … absolutely nothing that I said or the creator of the video qualifies as “propaganda”.
@@denofabsurdity The fact that you're willing to give all your labor rights away makes you either a propagandist or an idiot.
The economic scale and profound effect on businesses and employees should not be dictated by an executive branch agency. This sounds like an infringement on the legislative branch. This is going to the courts.
I hear ya! Unfortunately, the current and prior levels were all set by administrative action. That salary amount was never "part of the law", all the way back to the 1920's. Thanks for the comment though!