Employers Contemplating Changes Due to Proposed Overtime Rule

Employers Contemplating Changes Due to Proposed Overtime Rule

Employers Contemplating Changes Due to Proposed Overtime RuleThe Department of Labor announced new proposed overtime rules that will entitle nearly five million workers to the right to earn 50 percent more than the base wage for each hour worked in addition to the standard 40-hour week. The proposed rule would raise the threshold at which certain professionals qualify for overtime coverage under the Fair Labor Standards Act ( (FLSA). The rule, if implemented, would more than double the overtime exemption cut-off from $455 a week to $970 a week. This would mean that employees earning around $50,000 a year or less could qualify for time-and-a-half overtime pay.

Email Curfews

One potential reaction from employers if the proposed rule takes effect is that they will curtail the use of work email after hours. Raising the salary threshold for the overtime exemption may lead employers to convert more of their salaried managers to hourly pay, which, in turn, could mean that those workers could start claiming overtime for checking email during off hours.  California adopted overtime rules similar to DOL’s proposed rule, which resulted in employers adopting policies that limited workers’ access to email. Some employers even shut down email on weekends and at night, according to one news report.

Small Raises or Limited Hours

Employers could be implementing changes in order to avoid paying overtime under the new rules. For those earning salaries just under the new threshold, employers may decide to raise their base pay by a few thousand dollars. In doing so, they could bring salaries over the threshold and maintain the employee’s status as exempt from FLSA. On the other hand, employees who regularly work longer hours but do not get paid overtime might be able to head home earlier. Employers may prefer to send employees home after a normal eight-hour workday rather than pay overtime.

On the other hand, employers may also choose to lower an employee’s base pay to offset any overtime. If an employee normally works longer hours, employers may decide to lower that employee’s hourly rate so that he or she could be paid the same wage even though he or she is now entitled to overtime. This may be permissible as long as an employee is earning minimum wage under federal and state laws. This may also result in employers offering less generous benefits to non-exempt employees as compared with their exempt staff, such as slower vacation accrual rates, lower bonuses, or less generous health benefits

Until the new overtime rules take effect, the current FLSA regulatory scheme is still in effect. If you feel that you have been unlawfully denied overtime pay, you should call (855) 754-2795 or complete the Free Unpaid Overtime Case Review form on the top right of this page. Our top-rated team of wage lawyers will evaluate your situation to determine your best course of action. We will also determine if it is in your best interest to file a lawsuit against your employer. There are strict time limitations for filing, so it is important that you call our experienced attorneys today.

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