© 2020 Forbes Media LLC. Because of the nature of the work environment and working hours required by certain careers, there are a wide variety of specific exemptions to Iowa overtime eligibility. First, back to the days of timecards. They also regularly direct at least two employees’ work and either have the authority to hire or fire or are able to suggest or recommend doing so. There might even be state laws stipulating when you need to do so, so check into that. The law isn’t likely to change before going into effect so start putting together a strategy that works for your business. As a statutory interpretation matter, Judge Mazzant noted that Congress clearly expressed an intent to exempt all EAP employees, and not just EAP employees that made more than the standard salary. Overview of the 2020 Overtime Pay Rule. But wait, there’s more! Therefore, Arizona's overtime minimum wage is $18.00 per hour, one and a half times the regular Arizona minimum wage of $12.00 per hour. The site is secure. You can increase salaries, limit overtime, or pay overtime wages. Either one is legally fine (as long as the base hourly rate is equal to or higher than the minimum wage), but your employees may find the latter to be demoralizing. The employee must be paid a fixed salary that cannot go up or down based on the quantity—or quality—of their work. Given the similarities, it is less likely a court will find that the DOL exceeded its authority, as it did with the 2016 rule. The final rule will be effective on January 1, 2020. The most important changes to the salary test are summarized in the following table. Employees classified as exempt must receive a salary of at least $684 per week by January 1, 2020. The modern-day equivalent are online platforms that allow for clocking in and out on a mobile app but the idea is the same. Here’s an in-depth look at the new overtime rule for 2020, and a few steps on how to adapt. How Have the Federal Overtime Laws Changed? Let employees know that nonexempt status is not a reflection of their importance or performance. The final rule clarifies that payments in addition to the fixed salary are compatible with the use of the fluctuating workweek method under the Fair Labor Standards Act. For more information, please visit patriotsoftware.com or Follow: @PatriotSoftware on Twitter. Under the new rule hourly employees and salaried employees who earn less than $684 per week (equivalent to $35,568 per year for a full-year worker) in most cases must be paid overtime if they work more than 40 hours a week. Again I repeat, you must talk to your affected employees! And, be prepared for some disgruntled responses. If you have employees who are newly nonexempt due to the new overtime rule, you must, must, must talk to them about the upcoming changes. Judge Mazzant noted that if the standard salary had been adjusted for inflation, rather than doubled, “we wouldn’t be here today.” This ruling was never appealed, as the DOL moved on to its 2020 overtime rule instead of pursuing the 2016 rule. While the preliminary injunction was being appealed, Judge Mazzant granted summary judgement against the DOL, finding that the 2016 rule exceeded the DOL’s power for many of the same reasons that he granted the preliminary injunction. By accessing this website with cookies enabled in your web browser, you agree to the storing of cookies on your device. You may opt-out by. Mike Kappel is the founder and CEO of Patriot Software, LLC. The 2016 rule was quickly challenged and, ultimately, an injunction issued, preventing it from going into effect. With free employee scheduling, time tracking, team communication, and hiring, managers and employees can spend less time on paperwork and more time on growing their business. Reclassifying them might be the best option. It will increase to $10.50 for 2018, $11 for 2019, and $12 for 2020. Review Administrator Interpretations, Opinion and Ruling Letters as well as pertinent chapters of the WHD Field Operations Handbook. Divide the annual salary by 52 (weeks) to get the weekly salary. Because he found that the DOL’s rule was contrary to Congress’s intent, Judge Mazzant granted a preliminary injunction that stopped the 2016 rule from going into effect. If you are unsure of whether your state follows federal law or has a more generous state law, double check with your state department of labor or consult an employment attorney in your area. ” from overtime pay are executive, administrative, professional, computer and outside sales employees. On September 24, 2019, the Department of Labor (DOL) announced its final rule updating the salary threshold for the FLSA’s so-called “white collar” exemptions. [Looking for an updated, easy solution to timekeeping? The new rule increases the exempt salary threshold by $229 per week compared to the existing regulation, but is $229 less than … /*-->*/. Review the laws and regulations that govern overtime in the United States. Blog > Stay compliant > Federal Overtime Sal…. On January 1, 2020, the Department of Labor’s final rule that raises the salary threshold requirement for overtime exemption took effect. Nonexempt employees will need to receive overtime pay for any hours worked over 40 in a workweek. The DOL seems to think not. On May 20, 2020, the Department of Labor announced a final rule that allows employers to pay bonuses or other incentive based pay to salaried, nonexempt employees whose hours vary from week to week. Federal government websites often end in .gov or .mil. Proceed with caution. Under the new rule hourly employees and salaried employees who earn less than $684 per week (equivalent to $35,568 per year for a full-year worker) in most cases must be paid overtime if they work more than 40 hours a week. If neither of the above appeals to you, you can also limit the number of overtime hours newly nonexempt employees can work. This is a safe way to pick the number, as the courts struck down an Obama era change that was much higher and not based on the same standard. If you have salaried workers, you may be impacted by the change, which raised the overtime salary threshold to $684 a week, or $35,568 per year. Remember this is not official legal advice. Tim Parker is the Founder and President of. #views-exposed-form-manual-cloud-search-manual-cloud-search-results .form-actions{display:block;flex:1;} #tfa-entry-form .form-actions {justify-content:flex-start;} #node-agency-pages-layout-builder-form .form-actions {display:block;} #tfa-entry-form input {height:55px;} On December 12, 2019, the U.S. Department of Labor announced a Final Rule that will allow employers to more easily offer perks and benefits to their employees. Take a look at each of your exempt employees. So giddy-up and start preparing your payroll now!