Overtime Rules Delayed, Again

The Department of Labor broke its silence last month when Solicitor of Labor M. Patricia Smith said, during a panel discussion, that the final changes to the FLSA’s overtime eligibility rules likely will be delayed until late 2016.

The public comment period on the proposed rules ended in September with more than 270,000 comments filed and the DOL refusing to extend the standard comment period.

Was it the number of comments received, or election year politics, that moved the expected early 2016 date to late 2016, possibly after the November elections?

While the delay may buy employers time to adjust for the coming change, it provides no additional information on what the final rules will cover. While the minimum salary threshold is likely to rise significantly—between $40,000 and $50,000 are numbers we have seen in recent press reports—it also likely will be indexed to inflation.

More importantly to our members, the DOL is said to be looking at making changes to the long-standing exemptions, which include the outside sales duties test.

If you have not already done so, you may find it helpful to do an in-house audit of all your exempt employees. Do they still meet that classification under current rules? Would they meet the proposed DOL’s new regulations?

It would, at the very least, give you a head start and allow for budgeting any anticipated additional overtime pay.

When polled recently by the Society for Human Resource Management, here is what HR professionals said they expected:

• 76% unbudgeted overtime costs

• 70% increase in opportunities for employees to earn overtime

• 61% less workplace scheduling flexibility for employees

• 42% expect fewer opportunities for career advancement in the company.

Once speculation ends and the final rules are published, you can count on this Association to provide advice from our HR attorneys, David James and Joe Schmidt, who are shareholders in the labor and employment group at Nilan Johnson Lewis and provide HR legal advice to our members at no cost.

Their article, “White Collar Salary Exemption Gets the Squeeze,” which appeared in the July 22 Shortliner, is archived on the Association’s website and can be found using the search window or using this link: FarmEquip.org/7619

Whether it's the one-on-one advice or general HR advice that regularly appears in this newsletter and our Ag Innovator magazine, we encourage members to take advantage of this and other great membership benefits provided by FEMA Services Inc., developed under the direction of our Risk Management Committee. S