The Fair Labor Standards Act of 1938 (abbreviated as FLSA; also referred to as the Wages and Hours Bill) is a federal statute of the United States. It introduces the forty-hour work week, establishes a national minimum wage, specifies that overtime be paid at time and -a -half for hourly positions, defines the difference between a salaried-exempt and an hourly non-exempt employee (a.k.a. the duties test), and sets the standards for child labor laws. The FLSA applies to employees in both the private sector and federal, state, and local government. In late June 2015, the U.S. Department of Labor issued a Notice of Proposed Rulemaking seeking public comment on proposed changes to the Fair Labor Standards Act’s “white-collar” overtime exemption regulations. The proposed rule changes would more than double the minimum salary required for the FLSA’s white-collar exemptions (salaried exempt employees) from the current $455 to approximately $970 per week, with additional potential increases each year based on inflation.
Also, while the DOL did not propose specific changes to the exemption’s duties tests, it invited public comment on the subject, hinting that changes to the duties tests likely would be forthcoming in the final regulations.
The period for public comment on the proposed rules closed in September and we anticipate final rules most likely in early 2016. Employers have begun reviewing their pay practices to being planning for the implementation of the final regulations, which will likely require conversion of many employees currently treated as overtime exempt to non-exempt status or significant changes to the employees’ pay to meet the anticipated increased minimum salary requirement. With all these changes in mind, our presenter will share and discuss the following in this seminar:
General background on the FLSA and how it applies to state wage and hour laws;
The proposed changes to the white-collar exemptions and changes to the duties tests
Steps you should take to review your pay practices
How to implement conversion of salaried/exempt employees to hourly/non-exempt employees
Risks and ramifications employers should be aware of should they choose not be in compliance.