Federal law requires that all non-exempt employees are paid at a rate of one and one half times their regular rate of pay for all hours worked over 40 in a workweek. This is pretty straightforward to figure out when a payroll is processed on a weekly or biweekly schedule because the number of days in the pay period remain the same. But for employers who pay their employees semi-monthly (i.e., the 1st and the 15th of the month) the number of work days fluctuate from one pay period to the next depending on the way the calendar falls. Continue reading
The Department of Labor (DOL) has recently released a statement adopting a “primary beneficiary” test to be used when determining whether an intern for a for-profit employer should be classified as an employee under the federal Fair Labor Standards Act (FLSA). Continue reading
The Federal Fair Labor Standards Act (FLSA) requires that employers pay all non-exempt employees at a rate of at least one and one half times their regular rate of pay for each hour worked over 40 hours in a workweek. While this may seem straight forward, there are many misconceptions regarding when overtime is to be paid and to which employees. Below is a list of five of the top myths associated with overtime pay. Continue reading
If an employee is working overtime without permission from a manager, what options do you have as the employer?
Under federal law (The Fair Labor Standards Act or FLSA), if a non-exempt employee works more than 40 hours in a workweek they must be compensated at a rate of one and one half times their regular hourly rate for all hours over 40 in the week. If an employee is working, they must be paid for all time worked, even if the hours were not authorized by management. For example, if an employee is scheduled for 40 hours and works 46 hours, but the 6 hours of overtime weren’t approved by the employee’s manager, the employee must still be paid for all 46 hours worked. Continue reading
The Fair Labor Standards Act (FLSA) does not require that employers provide any rest or meal breaks to employees other than for nursing mothers. However, if an employer decides to offer these breaks to their employees, the FLSA does provide some rules that must be followed:
- Breaks of a short duration (typically 20 minutes or less) should be paid breaks that are counted as time worked and should be included in the total hours calculation for overtime purposes. This includes restroom breaks, breaks to get a beverage, smoke breaks, etc.
- Meal periods (typically 30 minutes or more) can be omitted from total hours worked and can be unpaid breaks when an employee is relieved of all job responsibilities for the duration of the break.
With the new minimum salary threshold for exempt employees taking place later this year (Read more about that here), employers should concentrate on making sure they are in compliance with the new rules and also confirm that their exempt employees are correctly classified. In addition, employers should make sure they fully understand how exempt employees should be paid.
To help employers with understanding payment of exempt employees, we’re debunking three common myths associated with exempt and salary employees.
UPDATE: November 22, 2016 – A federal judge has delayed the new overtime rule. At this time it is not known how long the rule will be delayed or if the new rule will be enforced at all in the future. The minimum salary threshold for exempt employees will remain at $455 per week until further notice.
The Department of Labor (DOL) has issued the much anticipated final rules regarding overtime for salary employees.
Under the Fair Labor Standards Act (FLSA), the minimum pay for exempt employees is currently $455 per week (or $23,660 per year). Under the new rule, effective December 1, 2016, the minimum pay will increase to $913 per week (or $47,476 per year). The salary threshold will automatically be updated every three years, beginning on January 1, 2020, based on average wage growth.
An added provision of the new rule is the ability for employers to include nondiscretionary bonuses and incentive payments, including commissions, up to 10 percent of gross wages, to meet the minimum salary requirements. For example, if an employee is paid $44,000 base salary and receives a bonus of $4,000 per year (less than 10% of their gross annual salary), they could still be considered exempt under the new rule because their total compensation ($48,000) is higher than the new salary threshold.