You may have heard about a new rule that might mean changes to whether you get compensation for working overtime. The Department of Labor provided more information about which white-collar employees are now covered by minimum wage and overtime rules.
The new overtime regulation will have a tremendous impact on employees, says Micah Longo, an employment lawyer with The Longo Firm. Under the new regulation, employees who make less than $47,476 will be entitled to overtime pay, no matter their job duties, Longo says. Here’s what you need to know.
Your Salary Might Go Up
Your employer has several options to ensure compliance under the new rule. Your employer may boost your pay to more than $47,476 a year to remove you from overtime protections, Longo says, or it may limit you to 40-hour work weeks, which may include tracking your hours.
Your employer also may ask you to track time you spend on work when not in the office, such as taking phone calls on the road or sending emails from home. Those actions, as work, would need to be tracked if you’re eligible for overtime compensation.
Your Workload Might Change
While the overtime rules are intended to improve the ratio of working hours to wages for employees, there may be other changes, says John Waldmann, co-founder and CEO of Homebase, which provides software solutions to track OT payments. “Hourly employees may pick up shifts or second jobs from other employers to cover the loss of wages, and exempt employees may have added job duties as tasks are transferred from hourly employees to exempt employees in an effort to reduce overtime.”
There Probably Will Be Some Disruption
There may be some confusion and tension as changes get worked out. “Even with all of the media attention, many employers will not be in compliance by December, particularly smaller employers who do not have ongoing access to employment law counsel,” employment lawyer Ann-Marie Ahern says. “The FLSA is a complex statute, and even with the best of intentions to treat employees fairly, an employer can easily run afoul of the regulations.”
If your employer changes your status, try not to take it personally. “Employees who have been promoted to salaried jobs may feel demoralized by the change in status and a feeling of demotion,” Waldmann says, but it’s important to realize that the employer is doing what it has to do to stay compliant under the rule. Talk to your manager or HR director if you have questions or concerns.
Finally, be aware that this minimum salary is subject to automatic boosts every few years. Under the rule, the salary is the 40th percentile of earnings of full-time salaried employees in the census region with the lowest wage, which is currently the South. This level will be updated every three years starting Jan. 1, 2020.