It’s time for human assets professionals to plan a plan for dealing with a probably drastic enhance to the Honest Labor Requirements Act’s additional time threshold, a Cozen O’Connor legal professional not too long ago stated final week.
Employers ought to take into account “proper now” how they might deal with a change that might enhance the FLSA’s regulatory wage threshold for additional time eligibility from about $35,000 to about $55,000, Mariah Passarelli, member of the agency, stated throughout a digital convention.
The U.S. Division of Labor proposed that change in August and closed the general public remark interval on Tuesday.
The American Council on Training, greater training’s prime foyer, famous in September that the rule might affect school employees positions, corresponding to info expertise and admissions staff.
Exempt staff paid lower than $1,059 per week, which quantities to $55,068 per yr, will lose their FLSA exemption if the proposed threshold is finalized, Passarelli defined. If that occurs, employers have just a few choices.
Some will select to reclassify affected staff as nonexempt, paying them additional time; some in that group might take away work from these staff in an effort to attenuate additional time hours labored, she stated.
Different employers may enhance pay for exempt staff to at the very least $55,068 to keep away from the additional time obligations that might end result from the rule, Passarelli stated, however the price range wanted for that may very well be important. “I believe it’d be out of attain for a lot of corporations.”
Employers can’t merely ignore an worker’s duties, nonetheless. “You need to be certain the wage foundation take a look at has been met, however you additionally should adjust to the duties [test],” she stated. The identical goes for any state or native necessities. In any other case, an employer might discover itself paying as much as $20,000 additional to somebody who stays exempt — “and that is in all probability the least engaging of all attainable choices,” Passarelli stated.
Whereas DOL might make modifications to the rule earlier than it’s finalized — and any last rule is also prone to face judicial challenges — she stated it’s nonetheless vital to plan.
Modifications don’t should be made but, sources beforehand informed HR Dive. However Passarelli really helpful attendees ask themselves: “Do you could have a considerate plan for what occurs if the wage foundation jumps in the best way that it’ll if this proposal is handed?”
