123ArticleOnline Logo
Welcome to 123ArticleOnline.com!
ALL >> Business >> View Article

2015 Interpretative Changes To The Fair Labor Standards Act

Profile Picture
By Author: Amicus Mediation & Arbitration Group, Inc. provides Alternative Dispute Resolution (ADR) services to
Total Articles: 4
Comment this article
Facebook ShareTwitter ShareGoogle+ ShareTwitter Share

I have been asked by many clients how a piece of federal legislation can literally be amended without an act of Congress. If you have been following the press coverage of regulations revising the Fair Labor Standards Act, then you already know that executive branch rewriting the rules of the game is permissible so long as the regulations are promulgated and subject to comment.
The major change is in the definition of exempt categories. Under the new rules, an exempt employee must be paid at least $970 per week when the regs take effect in mid-2016. This is more than double the current minimum of $455 per week. There will be annual upticks in this number as well. In real world terms, this will be a game changer for many of my clients, particularly those outside major metropolitan areas where $50,000 is an exceptionally high income level—one not attained by teachers, nurses and even business owners!
The expectation now, pending further releases in August, is that the Department of Labor will also revise the job duties elements of the administrative exemption to narrow the number of employees who would qualify ...
... to be paid on a salaried, rather than hourly, basis.
To date, the FLSA requires that, to be exempt, an employee must meet certain job duty requirements involving the exercise of independent judgment, discretion and supervision. How did DOL get to that $50,000 number? They used the 40th percentile of earnings for full-time salaried workers nationwide. They also plan to up to the exemption for highly compensated employees from $100,000 to $122,148 annually.
The reason that the regulations are being held back to August is that DOL wants additional information on the duties tests. There is concern that, as currently implemented, they are screening out workers who do non-exempt work for part of their days. California now uses a 50 percent test and the feds are certainly looking in that direction.
Additionally, DOL is considering adding a list of occupations that must be classified as non-exempt to
“provide guidance”. Clarity is always a good thing as it avoids misinterpretation but you can well imagine that certain industries will be targeted!
Even though, in theory, we are dealing with implementation within the next year, this could easily be delayed. When the rules were last revised in 2004, the entire process took over 17 months so we may be looking at changes effective in the 4th quarter of 2016 or 1st quarter of 2017. The administration would undoubtedly like to make these changes its crowning achievement in employment law as it departs Washington, knowing that reverting to the status quo will be a difficult and highly limited endeavor. That is not to say that employers can be complacent about these potential changes.
Right now, you should be re-examining your job descriptions, evaluating the effects of reclassification on your bottom line, considering reductions in force/hours/pay rates and even raising the salaries of some employees to meet the $50,400 threshold. Understand that as these changes are publicized, workers will be scrutinizing your policies to assess whether they have been shorted in pay and could commence administrative or legal proceedings against you. These decisions should be well thought out and planned with the assistance of your attorneys and accountants.

Total Views: 240Word Count: 559See All articles From Author

Add Comment

Business Articles

1. Single Piece Flanged End Ball Valve Manufacturers In Ahmedabad, India – Mnc Valves
Author: mnc valves

2. A Simple Guide To Pitra Dosh And Kaal Sarp Puja At Trimbakeshwar
Author: Manoj Guruji

3. The Evolution Of Cnc Machined Components: What Oem
Author: Arrow Off-Road

4. How To Design A Step And Repeat Backdrop That Looks Professional?
Author: Steve Morgan

5. Spartan Jetter For Sale | Professional Hydro Jetting Equipment In Utah
Author: HotJet USA

6. Top 5 Factors To Consider When Selecting A Gasket
Author: Gasco Inc

7. Hiring In Mumbai Without The Chaos: A Practical Guide
Author: Digirecruitx

8. Bpo Outsourcing Company
Author: kajal

9. Renewable Energy Companies And The Challenge Of Grid Integration
Author: Hartek Group

10. How Freight Claims Management Works [2026 Updated]
Author: ArgusLogistics

11. Byst: Setting A New Standard In Business Mentorship Excellence
Author: Byst Youth

12. Voice And Visual Search: What Researchers Must Know
Author: Philomath Research

13. Let’s Build Your Bpo Business Together!
Author: Zoetic BPO Services

14. How To Spot Fake Copper And Brass Cookware At The Market
Author: Copper Brazier

15. Why More Industries Are Turning To Kyc Projects Right Now
Author: mohan

Login To Account
Login Email:
Password:
Forgot Password?
New User?
Sign Up Newsletter
Email Address: