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: 305Word Count: 559See All articles From Author

Add Comment

Business Articles

1. Iso 22301 Consultants And Bcm Consultants In Oman, A Practical Guide To Business Continuity And Organizational Resilience
Author: kohan

2. Dtf Sticker Printing For Driving Schools And Driver Training Teams
Author: ZENITH

3. Indian Passport Renewal In Usa: Step-by-step Guide
Author: Anvit Gupta

4. The Complete Guide To Planning Your Social Media Content In 2026
Author: neetu

5. Why Ride-on Sweepers Are Useful For Parking Lot Cleaning
Author: Steve Smith

6. Planning Your Christmas Lights Installation: What To Do Before The Installer Arrives
Author: billy butcher

7. Embroidery Machine Buying Guide: Key Questions To Ask Before You Purchase
Author: HSW

8. High End Pocket Doors: A Modern Solution For Elegant Interiors
Author: mike

9. Custom Stone Countertops: A Practical Guide For Stylish And Durable Spaces
Author: mike

10. Sap Sd Offline Training In Hyderabad – Build A Successful Career With Avina Technologies
Author: Avina Technologies – Best SAP Training Institute

11. Foundation Bolting San Diego: Improving Home Foundation Connections
Author: Premier choice

12. Concealed Doors – A Seamless Solution For Modern Interiors
Author: mike

13. Foundation Crack Repair San Diego: Understanding Common Causes And Repair Options
Author: Premier choice

14. How To Make Your Two-wheeler Move To Delhi Simpler
Author: Moving Solutions

15. What To Consider Before Buying An Industrial Vacuum Cleaner?
Author: Steve Smith

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