Just a few years ago (2016) the federal government announced an increase to $47,476 in the salary test for exemption from overtime payment, nearly double the former salary test of $23,660 (in effect since 2004 when minimum wage was $5.15 per hour). Employers scrambled to comply, in some cases giving substantial salary increases to avoid paying overtime to eligible employees. And then … the increase was struck down by a federal judge in Texas leaving many happy employees (if the salary increase wasn’t rescinded) and confused employers.
Now the Department of Labor is set to issue a Notice of Proposed Rulemaking “to determine the appropriate salary level for exemption of executive, administrative and professional employees.” What does this mean to you, as an employer? Currently, experts expect an increase in the salary test for exemption from overtime to the low-to-mid $30,000s. While we are waiting for this announcement, expected in March 2019, here are some other things that you need to know that effect how you pay your employees:
To prepare for the coming change in the salary test, now would be a good time to review your current job descriptions and practices to make sure that your employees are classified correctly as exempt or non-exempt and that you are paying overtime correctly.
An HR professional can help you with all of your human resource needs, from hiring the right employees, running background checks, creating employee handbooks that include anti-harassment policies and procedures, managing employee performance, staying legally compliant, automating employee records, and anything else you need to create an environment where employees can provide the services that you need to run your business.