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Wednesday, October 26, 2016

New overtime rules: 1 good outcome and 7 bad ones

Do you have employees who are on salary? Do those employees ever work more than 40 hours in a week, for whatever reason? If the answer is yes to these questions, your world is about to get more complicated and probably more expensive.

Please stay with me. I need to get into the weeds, but just for a minute.

The current Department of Labor (DOL) overtime exemption threshold for “white-collar” employees is anyone with a salary of at least $23,666 annually, or $455 per week. Exempt means the employer is not required to pay overtime if and when this class of employee works over 40 hours per week. This threshold applies to all businesses, regardless of size or number of employees.

Here’s the news: The DOL has announced that as of Dec. 1 that overtime exemption threshold will essentially double, to $47,476 annually, or $913 per week.

So anyone currently receiving a salary of less than this new amount will soon convert to non-exempt status and must be paid overtime when they work more than 40 hours a week.

The reason I’m concerned about this change is because of the size of the increase.

I fear this new threshold is going to catch and hurt a lot of unaware small businesses in its net. So I took this concern to my small business audience in our online poll recently and asked if they knew about the new overtime exemption changes.

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11 comments:

Anonymous said...

Timing on this AND $15 hourly min wage is not good. Why? Cuz the customer ends up paying!

UGH!

Anonymous said...

And that same customer will now have more money to spend. Consumer demand creates jobs. Not the rich who get that way by minimizing labor costs and maximizing prices. 47k is well below national median salary. So either pay a higher salary or pay the employee for extra time and dedication

Anonymous said...

While this seems like a wonderful thing for those making between $23K and $47K, it has WTF written all over it.
Look forward to higher prices, fewer hours over 40, expecting more in those 40 hours, hiring cheaper labor, fewer advancements, and some lost jobs. Those making $47K can look forward to a $3K raise to keep them from getting overtime.

Anonymous said...

if you want to scam hard working AMericans by not paying them for their work, move to china or go work for Trump....

Anonymous said...

You will just see less salaried employees. The same employees that want that over time pay have no problem collecting a 40 hour paycheck and only working 35 but if they work over 40 they want more money. Change them all to hourly and see how they like it.

Anonymous said...

The only one that makes out is the government just feed the beast , it just equals more in taxes the little working unit pay's

Anonymous said...

My husband makes 58,000.00 and we get after exemptions and 401k, only 500.00 wk..these numbers are based on net...for sure.

Anonymous said...

go work for Trump....

October 26, 2016 at 8:41 PM

I wonder just how successful Trump would be if everything that is said about him was true.


You work 40 hours a week? That's cute. I used to have a part-time too.

- some trucker

Anonymous said...

So here is how you promote confidence in a subpar situation. What is considered full time employment? 32 hours what was it before? 40 hours....now add the part of counting part time Jobs in your employment numbers.....add in new overtime regulations.....and BAM ...you have successfully created false employment data.....but everyone will feel good.....

Anonymous said...

And what about "agricultural" workers. They don't get any overtime until they hit 60 hours. My cheapskate employer has had me classified as an agricultural worker for over 2 years even though I work in an office! What do you do? Quit and have NO job? Complain and face the payback?

Anonymous said...

What do you do? Quit and have NO job? Complain and face the payback?

October 27, 2016 at 7:26 AM

Quite simply, yes.