Previous Annual Salary Amount | New Annual Salary Amount | |
Most Exempt Employee Classifications | $23,660.00 | $47,476.00 |
Highly Compensated Employee Classification | $100,000.00 | $134,004.00 |
- Raising salary levels to bring the positions salary to the required level.
- Reclassifying employees from exempt to non-exempt (which would mean the employees would be eligible for overtime pay).
- Scrutinizing the hours worked by all employees, including employees currently categorized as exempt, to determine whether and how much those employees are working beyond 40 hours per week. If reclassifying exempt positions to non-exempt will result in new overtime pay obligations, employers can limit overtime costs by adopting policies to limit overtime work hours. Alternatively, an employer might hire additional employees or redistribute job duties to more than one employee to minimize overtime hours and corresponding pay requirements.
- Employers can also consider wage rate changes for employees. So long as a non-exempt employee makes at least minimum wage for all hours worked and an employer satisfies any contractual pay obligations, wage rates can be prospectively changed to reduce the cost impact of the Final Rule on positions that may need to be reclassified as non-exempt. Before changing pay, though, be sure that there are no contractual pay obligations to an employee that might be violated by the proposed pay change.
Please visit our client alert for a more detailed analysis of the Final Rule, as well as our previous posts on FLSA Fundamentals.
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