ask all your questions about the new overtime law here

Do you have questions about what the new overtime law will mean for you? There’s a round-up of reader questions about this below, and you’re welcome to leave your own questions in the comments; I’ll try to answer as many as I can.

First, a quick recap:

  • As of December 1, if you earn less than $47,476 annually, your employer will be legally required to pay you overtime (time and a half) when you work over 40 hours in a week.
  • This is because the federal government is changing one part of the way it decides whether you’re exempt (not legally required to be paid overtime) or non-exempt (must be paid overtime). To be exempt, you must meet two tests: a salary test and a duties test. You must earn $47,476 annually (this is the change — it’s an increase from the current level of $23,600) and perform relatively high-level work (more here on what that means). The duties portion of the law isn’t changing, only the salary level.
  • If you currently earn $47,476 or more, or if you currently earn less than $47,476 and are classified as non-exempt (meaning you’ve been legally required to get overtime pay all along), this doesn’t change anything for you.
  • If you currently earn less than $47,476 and are exempt (meaning you previously haven’t received overtime pay), you’re in the group impacted by this. You will now be required to receive overtime pay (time and a half) for any hours over 40 that you work in a week. Here’s a summary of some of the ways your employer might choose to handle this.

1. When should I ask how the new overtime rules will impact my job?

When is a reasonable time to ask how the new rules for exempt employees will affect my current position (currently exempt, with salary less than $5,000 below the new $47,476 threshold)? And should I ask my manager who does little with salary, or HR?

Now is a reasonable time! They may not have an answer for you yet, but it’s not unreasonable to ask. I’d start with your manager, and if she doesn’t know, check with HR.

2. If I become exempt, do my duties need to stay the same? And can my employer lower my rate of pay?

I am currently an exempt manager making the minimum $455 per week to be exempt under the current overtime law. Once the new law goes into effect, if my employer decides to put me on hourly to avoid paying the increase in salary requirement, can they make me perform the same management duties I currently am doing — but as a non-exempt hourly employee? And can they pay me less per hour if they put me on hourly?

Yes and yes. They can indeed have you doing the same duties, and they can lower your hourly rate. (They can’t do that retroactively, but they can do it going forward.) Some employers in this situation may choose to lower people’s hourly rates, on the assumption that they’ll be paying overtime that they didn’t used to pay (and so they’re trying to get it to work out to about the same overall annual pay).

3. Negotiating a raise to stay exempt

My wife is a salaried exempt employee with a $39,000 salary, well short of the new December 1 salary level; she’s the only person at her firm in this situation. The BLS mean wage for her particular job in our metro area is $59,000, and she’s making slightly below the 25th percentile. She averages 48-50 hours per week. Doing the math, the difference is less than if the company paid her six hours overtime per week. It’s a small firm (under 15 employees) and cutting her workload would make them miss deadlines on some lucrative contracts. Should she try to proactively negotiate a 20% raise to keep her exempt, or just wait and see what management tells her and react from there? If you were the boss of this situation, what would you be likely to do? Do the new overtime rules give people in the “gap” extra leverage to negotiate raises?

This company recently hired, then had to fire (for misconduct) a few months later, another person in her department who was carrying the same duties as she had, and after he was let go, word got out that he had been hired on at $55,000. My wife didn’t know that salary negotiation was “was even a thing you could do” when hired, and took their first offer, but it doesn’t seem likely that they could replace her production for less than the new exempt minimum. Does this change the outlook on whether or not she might get the raise?

Yep, she could proactively propose that they raise her to the new exempt level, pointing out that it would be the equivalent of keeping her non-exempt and paying her for six hours of overtime a week, and pointing out that she normally works more than that amount of overtime in an average week.

That’s likely a financially sound plan for them, although it’s possible that they’re considering other options instead (including keeping her non-exempt but lowering her base hourly wage so that even with the overtime pay, her overall annual wages come out about the same).

The fact that they hired someone into the same role for $55,000 is highly relevant, in that it tells her that they’re willing to pay that rate for the work she does and that they may assume they’d need to pay if they had to replace her. So that’s a very good sign.

4. Getting a higher salary when the overtime rules are giving everyone gets a raise

I recently accepted a job offer (thanks to your wonderful interview guide and the information I found on this site!) for a job that is currently exempt and requires some periods of travel and overtime. It pays less than $47,476, though, so when new overtime laws go into effect on December 1st there will be changes to my pay. I’ll either be switched to hourly or given a flat raise, but either way my new manager says it’s likely I’ll be making more than I am now.

My question is how to (tactfully) ask for a raise beyond the minimum amount that all people in my position will be given. When I was offered the position, I was specifically told that the hiring manager had to get special approval to max out the salary range for the position but felt I was worth it due to my unique experience and excellent interview (thanks again!). If we’re all given a flat raise, is it appropriate to ask for a raise beyond the minimum $47,476 and how would I go about doing so?

I wouldn’t at this point. Presuming that they’re currently paying you a rate that you felt was fair for you work, it’s not really a strong argument to say “well, you’ve raised me over the rate I earlier agreed was fair, but I want more solely because I want to be making more than other people.” It’s also not likely to go over well at a time when your employer is probably facing significant new salary expenses for a number of people.

But you can possibly address this at your next salary review after this one (or bring it up yourself in a year, whichever comes first). At that point, if you’re significantly exceeding expectations for your role, you could potentially argue that the base rate for the position is $47,476, and your excellent performance warrants a higher level of pay than the base rate. I’m couching this with “possibly” and “potentially” because it partly depends on what your salary is now. If increasing you to the new exempt level isn’t a massive increase, this strategy would make sense. But if you’re earning, like $30,000 now, this argue will be less compelling.

Feel free to leave your own questions about the new overtime law in the comments.

{ 498 comments… read them below }

    1. OFer (OP 2)

      Part-time staff don’t routinely go over 40 hours in most cases, so there should be no issue with exempt/non-exempt as long as their hours are being recorded and the rare case of overtime is compensated.

      1. mcm

        Exactly my issue – I have an exempt part-time employee who, if she were at 100% FTE, would be making over $20,000/year above the threshold. HR has just informed me that she will need to either increase her hours, or be reclassified as nonexempt (while her full-time counterpart, performing the exact same job, remain exempt, with the better benefits that come along with an exempt role). I completely understand the reasoning behind increasing the threshold, but am frustrated by the (apparent) lack of consideration for part-time employees!

        1. Pinkie Pie Chart

          Why do your non-exempt employees have different benefits? I’m just curious, since I don’t recall a difference in places I’ve worked.

    2. fposte

      This is a change in the OT threshold in existing law; existing law didn’t say anything about part-time exempt, and I suspect that’s a category that only came into serious being since the last change to the OT threshold. I’m not even sure if they *could* make a pro rata rule for part-timers, and it would certainly be more complicated to do so.

      1. Chriama

        I’m not sure I understand the impact on part-time exempt people. If your salary is prorated to 75% because you’re only supposed to be working 30 hours a week, aren’t you still under the threshold for overtime? I guess if there are periods where you work crazy hours for a month and then time off for a month (getting paid the same salary whether or not you’re working) then the volatility screws up the overtime calculations, but does that happen often?

        1. Aunt Vixen

          As I understand it, it’s like this. Job pays $50k and expects 40 hours/week, but is exempt, so some weeks may be 35, some may be 50, life is like that when you’re not billing every hour to an external client. You negotiate .8 FTE, so you get paid $40k and work 32 hours/week, and you’re still exempt, so some weeks may be 25ish and some may be closer to or even a little over 40. Same as the full-time person only you’re only expected four days a week instead of five.

          But in the new system, if you’re making $40k, you’re ipso facto non-exempt, so you have to track your hours in case you go over 40 because if you pass 40 hours, even in your four-day work week, they are now required by law to pay you overtime. Your full-time colleague making $50k is making the same $50k in five days no matter how many hours she racks up in those five days (35, 30, or 60), but if you go to 40 hours and 15 minutes, you’re getting time and a half of that $40k.

        2. mcm

          I’ve been told that, as long as my employee is making less than the $47K threshold, she cannot be exempt; there doesn’t seem to be any way to allow her salary to be prorated (e.g., you’d assume a 75% employee must make at least $35K rather than $47K, but that doesn’t seem to be the case). My issue has nothing to do with overtime – she will rarely, if ever, work 40+ hours in a week, and we’d gladly compensate her if she did – but with the fact that our exempt employees get different benefits than non-exempt, and I don’t want her to have to lose those benefits.

          1. Elizabeth the Ginger

            It also means she may have (at least slightly) variable paychecks, and that she’ll need to spend time tracking her hours, both of which are at least slightly annoying. Though the benefits issue is a much bigger one, and may be a sign that giving employees different benefits based on exempt/non-exempt status isn’t really the way to go.

            1. mcm

              Well, we could make her salaried non-exempt, for paycheck consistency, though the hours-tracking would be a pain, you’re right. Regarding the benefits, while I understand why you make that assessment, there are two other factors at play – a) I’m in a 45,000-person organization, and making change around here is a long, slow process and b) I think the benefits in question actually might make sense – namely, exempt employees accrue vacation slightly faster than non-exempt, presumably as a nod to the fact that they often work 40+ hours in a week without compensation, unlike their non-exempt counterparts. (And, again, since the employee in question probably won’t go over 40 hours, she won’t get the time-and-a-half consideration that normally comes with putting in that extra time.)

              1. Elizabeth the Ginger

                Hmm, that seems fair, but could still sting a bit if her take-home pay stays the same while her benefits decrease. I know employers have the right to change benefits at any time, but it still doesn’t feel good. If possible, you might be able to ease the sting by giving her a small raise so she doesn’t feel like she just totally lost out?

  1. Leatherwings

    I’m a bit below the $47k threshold, and I typically work under 40 hours a week (we have very flexible start and stop times, so I frequently come in a little later or leave a little earlier, totally fine with my office culture but they would still say I work full time). If they choose not to bump me to the threshhold and switch my status to non-exempt, would they have to pay me strictly hourly (and so my salary could go down) or would it be possible for them to only track my hours to determine when I go over 40 and still pay me the same otherwise?

    1. Ask a Manager Post author

      They can make you salaried non-exempt, which means that your salary would be the same each week except when you went over 40 hours (and then you’d get overtime). They do not have to switch you to hourly.

      1. Leatherwings

        Thanks! That clears up a lot, and I think that’s probably the route my employer will take. It’d be a relatively big bump to go up, but we don’t have a great system in place to record hours and pay that meticulously either.

      2. Small town reporter

        I am so glad Leatherwings asked this and you answered this. I make well under the threshold, but for the industry and the cost of living here, I make a pretty good salary. The flexibility of working less than 40 hours occasionally is one of the things that attracted me to this particular position, and makes times like this week, when I worked all weekend on top of a regular week, palatable. I’m not sure yet what my company is going to do with me, but I’m totally going to ask if they’d consider salaried nonexempt. It would make a lot of sense in my particular position.

      3. HR

        Keep in mind that a true “salary non-exempt” relationship only requires “half-time” after 40 hours instead of “time and one-half.” The employee must still track his hours so that overtime can be paid accurately but the employee should not have his salary docked when he doesn’t work 40 hours. Win-win for employee and employer.

        1. Natalie

          That’s not accurate – FLSA requires time and a half overtime for anyone who’s non-exempt. If they’re salaried, the rate is calculated by determining their hourly rate for 40 hours a week and then paying 1.5 that.

          1. HR

            The “Fluctuating work week” method (also called salaried, non-exempt) only requires 1/2 time over 40 hours. The employer MUST NOT dock the employee for weeks when he doesn’t work 40 (he gets his guaranteed salary every week). In exchange, the employer only pays half time for hours over 40 (calculated each week based on the hours worked). The DOL allows this system to address “fluctuating” work weeks (NASCAR mechanics and landscapers use this a lot because of the fluctuation in hours throughout the year). Page 2, top paragraph. https://www dot dol dot gov/whd/opinion/FLSA/2009/2009_01_14_03_FLSA.pdf

            1. Natalie

              That only applies to employees with a fluctuating workweek, which is definitely *not* all or probably even most salaried non-exempt employees.

          2. HR

            See the DOL explanation about paying Fluctuating Workweek or Salaried Non-Exempt. If a companies accurately pays the guaranteed salary every week, then they only are required to pay half time for hours over 40. The regular rate is calculated every week to find the premium (it’s an administrative nightmare but often used by industries like NASCAR or landscaping). See the top of page 2. https://www.dol.gov/whd/opinion/FLSA/2009/2009_01_14_03_FLSA.pdf

    2. Anna

      I am in the same boat as you except that I have always been classified as nonexempt. But my job is much like yours–flexible-ish hours, no overtime ever. I’m officially working 35 hours per week, and I’m expected to be at work for those number of hours, but no one is really counting down to the minute. I often cut short my hours one week if I know I went a little over the week before, but I’m always paid for 35 hours. If my employer needed me to work overtime (most of the time that I work “over” it isn’t because my employer asked me to, I just wanted or felt I needed to finish something at that particular moment and it went a little past the clock), they would pay me for any hours worked over 35, plus time and a half for hours worked over 40.

  2. Joseph

    My understanding (correct me if needed) is that this is based on Department of Labor regulations and not a formal act of Congress. The DoL has clear statutory authority, but if a different President with different priorities is elected, could the new Secretary of Labor direct the DoL to change their tune and revoke the new rules immediately? Or is this something that once enacted, will be locked into place?

    1. neverjaunty

      There’s a rules-making process for all agencies, so I doubt a new President could change those rules easily.

      1. Ask a Manager Post author

        Yeah, and I believe they’re required by law to have a public comment period, etc. It’s also worth noting that while there’s been some congressional opposition this, it hasn’t been enough to stop it from moving forward. I don’t think this is getting undone.

        1. Creag an Tuire

          I’m not sure I’d be that absolute — there’s a world of difference between getting the votes needed to override a Presidential veto (nearly impossible) and pushing through legislation that a new President would be willing to sign.

            1. Creag an Tuire

              They seem to be unwilling to ask their members to vote on legislation in an election year that would be immediately vetoed and thus serve no purpose but to give their opponent a free attack ad. That’s not necessarily predictive of what they can do after November.

              Sorry, I won’t push this further, I just strongly disagree with telling people that there’s no way this could be repealed if the elections go a certain way.

      2. Leatherwings

        Yes, and regulations go through a public commenting period before they are enacted. It’s a regimented, well-established practice and although it is an executive function, a President wouldn’t have the ability to change the rule on a whim.

    2. Pwyll

      At this point, the new rules will go into effect in December no matter who is elected President: there simply is not enough time for DOL to promulgate a new rule, and there won’t be a new Secretary of Labor confirmed to be able to push for a new rule before its effective date.

      If a new President were to direct DOL to rescind this rule, they’ll almost certainly need to engage in Notice and Comment Rulemaking. Which means they will need to include the action on the agency’s regulatory plan and get approval from the White House, draft a proposed rule, publish it in the Federal Register, open the Rule to Notice and Comment on Regulations.gov for at least 30-90 days, review all comments received, draft a Final Rule, send it back to OIRA (the White House) to be reviewed for 30-90 days, have an Economic Impact study done, publish the final rule, wait for 30 more days to see if Congress passes a law to the contrary, and then, finally, it can go into effect. So, we’re looking at least a year, and likely longer, for any major change to the regulation. (This is a bit oversimplified, even.)

      Of course, Congress could pass a law removing this from DOL’s purview, but it doesn’t appear they have the votes to do so.

      1. Countess Boochie Flagrante

        More to the point, no matter who is elected President, they will not actually be President until January 2016. So the rules will already be in effect before the new POTUS would be able to do anything about them.

  3. Marketing Person Who Doesn't Pass the Salary Test

    So if I meet the ‘duties test’ but not the salary test, do I still need to be paid overtime?
    -I’m the marketing person for my company I know I pass the duties test for what makes somebody ‘exempt’
    -I also make less than the $47k amount.

    So will my company need to change they way I’m paid or not really (because I pass the duties test)?

    Thanks!

    1. Always Anon

      Hopefully someone with more knowledge on this will comment, but I believe the answer to that question is yes.

      If you make less than the salary threshold then your position must be reclassified as non-exempt and you must be paid overtime.

    2. Karo

      My understanding is that you have to meet both tests to not get paid overtime. So if you have A but not B, or B but not A, you have to get overtime.

    3. Ask a Manager Post author

      Yes, you must meet both the duties test and the salary test. If you meet one but not the other, you are non-exempt.

      So yes, in your case, they’ll have to raise your salary or pay you overtime.

      1. Marketing Person Who Doesn't Pass the Salary Test

        Thanks for all the responses to this. I appreciate it.

      2. Corporate Communications Person Who Doesn't Pass the Salary Test

        I’m an employee in the same situation as described by “Marketing Person Who Doesn’t Pass the Salary Test.” I have a meeting with HR and my management team on Monday. My team fought for me to stay exempt and loss the battle. I am preparing a list of questions to ask during the HR meeting. Do I have a legal right to know the results of the duties test for my position? We are hoping to have my position reclassified once the dust settles. (I work for a large, slow-moving company that already pays way below the industry standard)

    4. OFer (OP 3)

      Having devoured everything I can find on what the actual final ruling says, the only categories of worker that can be exempt without meeting both salary and duties are Outside Sales and Highly Compensated Employees (which have their own less-stringent duties test). If you meet the duties test but not the salary test, you’re non-exempt. If you meet the salary test but not the duties test, you’re non-exempt. If you work 40 hours a week or less, your hours would have to be recorded, but your salary could stay the same. If you work overtime, then yes, they would have to change how you’re being compensated.

      1. OFer (OP 3)

        Oops, as our gracious host points out down-thread, doctors, lawyers, and teachers don’t have to meet the salary test. Sorry for the slip up!

      2. HRChick

        There is also an “academic administrator” exemption for education institutions where the salary requirement is equal to or greater than the salary of a teacher in the school.

        1. Palmanic

          Agencies that receive federal (Medicaid) funds do not have to implant the changes until 2017

          1. Palmanic

            Sorry, agencies that support people with developmental disabilities don’t have to implement until 2017.

  4. Nervous Accountant

    We just had our annual performance evaluations and my salary was raised by 12%. This brings me to just a smidgen above the $47k limit. They said it was due to my hard work, but I know it’s also bc of the OT law.

    At first I was thrilled but the more I thought about it, I’m not sure if I should have pushed back for an increase.

    1. Nervous Accountant

      Maybe this is more of a question for the open thread but it was given on Wednesday, I’m not sure if after this Fri will be too late (if I can even push back against it???)

      1. E

        Research the average salary for your position in your area. I think that would give you support for a higher raise, if there’s evidence that a person with your experience in that position would be paid more than your recent raised salary.

    2. Jeanne

      It depends on your company whether you could push and actually get more. This is going to be weird for everyone.

  5. Florida

    Can anyone explain the nonprofit exemption? It sounds to me like a $5,000,000 homeless shelter would be exempt from the new law. But if the homeless shelter has a thrift store (or some other business) that made at least $500,000, they would have to abide by the law. If the thrift store made less than $500k, they would be exempt.
    Am I understanding it correctly?

    1. Ask a Manager Post author

      Nonprofits as organizations are covered by this law if they have $500,000+/year in business revenue. However, even if your organization isn’t covered under that provision, individual employees at nonprofits are covered under the law if they engage in interstate commerce in the course of their work (including making out-of-state phone calls; receiving or sending interstate mail or email; ordering or receiving goods from an out-of-state supplier; and handling credit card transactions or performing the accounting or bookkeeping for such activities).

      1. Florida

        So if the nonprofit was truly local, as in they never heard from anyone outside of their state, and the nonprofit had no business revenue, then the employees would be exempt. Right? (I know that isn’t likely. I’m just trying to figure this out)

        If you were a free daycare with no business revenue, then the person who ordered the diapers from out-of-state internet store would get overtime, but the childcare worker who used the diapers and only dealt with local babies would not qualify. Is that right?

        I’m not trying to play the what-if game. I just want to be sure I’m understanding it.

      2. Pwyll

        Keep in mind also that a handful of states have adopted by reference the Federal overtime rules into state law, and a handful have not adopted the non-profit exception. So you’ll want to look at state law too on this point (but it would be very,rare for any modern non-profit to be exempt from the Federal rules).

      3. Mela

        What would count as “ordering or receiving goods from an out-of-state supplier?” Say you order supplies online from a national chain like Staples. Would it be interstate if you were working anywhere outside of Massachusetts (where corporate headquarters are) or would the supplies have to be shipped from outside your state of employment?

        1. Natalie

          In general, the government interprets interstate commerce pretty broadly, so that would likely count.

        2. Pwyll

          They would probably look to whether the goods were shipped across state lines from the warehouse. As Natalie says, it’s an expansive definition.

          In the DOL’s guidance sheet, they mention a person who receives donations where the donor crossed state lines to deliver the donation, and state that would make the employee who received the donation covered under the law.

          1. Rusty Shackelford

            But doesn’t that mean that the employer would have no control over whether the employee was actually exempt, unless they did something radical like refusing to accept donations from out-of-state donors and didn’t allow their employee to answer the phone or read email for fear that contact might come from out of state? Or am I interpreting this wrong?

              1. Rusty Shackelford

                I’m finding this really confusing. (I’m not an employer, BTW.) Maybe control isn’t the right word, but… knowledge? A choice? As someone who’s involved in a non-profit, the idea that one of our employees could accidentally become non-exempt by accepting a donation, or answering an email, without our even knowing about it, is frightening! (This doesn’t affect my non-profit, since no one works over 40 hours, but it seems like a big scary possibility for others.)

                1. Ask a Manager Post author

                  It’s not really supposed to be a choice; in general, the default is for employees to be non-exempt, unless they fall in one of the categories that exempt them.

            1. Joseph

              The fact the employer has no control is actually the entire point of the change. This happened in large part because many employers (legally) abused the hell out of the “exempt” status by working low wage exempt jobs (e.g., restaurant shift manager) crazy 60+ hour weeks for like $30k. Now they either need to reduce the hours so such workers are 40 hours, pay for the overtime, or raise their base rate to cover it.

              1. Pwyll

                This, and the fact that DOL hadn’t altered the salary test in many years. The salary threshold was never supposed to be so low as to be below the poverty line.

                1. Jeanne

                  Both what Joseph and Pwyll said. I think they should have never waited so long to revise the rule. It should be regularly adjusted. But we should never have exempt below the poverty line.

                2. Elizabeth the Ginger

                  Jeanne – Agreed, except I think it would have been reasonable for them to have some kind of exception for part-time employees – like if you work half-time, the cutoff is $23,738 instead.

                3. Natalie

                  @ Jeanne, IIRC they did add a process to review it every few years and adjust for inflation, so hopefully this won’t happen again.

            2. Ultraviolet

              The employer shouldn’t have much control, since FLSA is meant to protect employees from being underpaid by employers. The law allows some employees to be exempt from its protections if they meet certain conditions–conditions, subjectively and broadly speaking, that entail a high salary or high status position or authority within the company (though there are certainly exceptions).

              But I was wondering if your question was maybe, “If using the phone or email makes an employee non-exempt, how is anyone ever exempt?” I am not clear on that–unless the idea is actually that FLSA applies to those employees by default but they can be exempted from it, even if their organization is not covered by FLSA at all?

              1. Pwyll

                It’s actually a bit more complicated than that by function of how Constitutional Law works. As a Federal law, the FLSA can only apply if the Federal Government has authority to regulate. As an individual person, the Feds don’t necessarily have the authority to regulate your ability to contract as labor. So, the FLSA doesn’t usually directly apply to individuals, but rather to their employers.

                Under the Commerce Clause, the argument is that the FLSA easily can regulate businesses because they inherently engage in commerce. Charities that don’t engage in interstate commerce are generally not covered by the law because the Feds can’t reach them (except in a few instances). Thus, in order to capture people working for such charities, the Government has to show that those people themselves are engaged in interstate commerce. So, under the Feds’ view, if you’re making interstate phone calls, e-mails or letters, you’ve effectively opted into the FLSA by engaging in commerce. Once the FLSA covers you, then you look to the regulation to determine whether you’re exempt or non-exempt based on your job duties and, sometimes, salary.

                1. fposte

                  I’d be kind of intrigued to know what businesses manage that in this day and age. Even in Alaska and Hawaii, I think it would be tough to pull off.

                2. Ultraviolet

                  Thanks for answering! I realized a few minutes later that I should really have asked whether being not-covered by the FLSA is the same as being exempt.

                3. Natalie

                  @fposte, even 60 years ago it was considered fairly implausible – the Civil Rights Act was held up in three separate court cases on precisely that theory, that even a small restaurant or store was engaged in interstate commerce somehow.

  6. Em Bargo

    I’m exempt and suspect that my employer won’t be increasing my salary. I’m fine with that. But on the off chance that they are, would it be advisable to ask to stay at my current salary and become non exempt? For the most part, I don’t often work much more 40 hours a week.

    1. Ask a Manager Post author

      If you don’t often work overtime, I don’t see any benefit to you in staying at your current salary (as it doesn’t sound like you have opportunity to earn overtime).

      1. addlady

        There might be one instance in which it might be a good idea–if they feel they need to start pressuring her to work longer because they had to pay her more.

      2. Em Bargo

        I’m more than $10k under the threshold, so I really don’t see them bumping my salary that much. But if they did, I would be concerned that they would give me additional duties or increase my workload. It would be nice to get a raise, but not at the expense of time with my family. It’s not worth it to me.

    2. Karo

      That depends on how much below the threshold you are and how much you work over. If you make $47,000 then it’d take them less than $500 to bump you up. If you become non-exempt at that salary, you could work less than 15 hours of overtime in a year and come out with more.

    1. Anonforthis

      I’m currently exempt, make less than the salary threshold, and occasionally work more than 40 hours, which is currently compensated with comp time.

      1. JOTeepe

        This might be true for the Feds, but not State and local government. I work for State government and we are still bound by the federal overtime rules. How exempt/non-exempt is determined is against DOL best practices, but based on personal knowledge of most of the exempt positions as applied to the salary test (I used to make FLSA classification determinations in a former position), they are on solid enough ground that it’s unlikely there would be call for an audit. One of the unions was threatening at one point to ask for an audit, and a project team was hired to do a full blown study. The results were that there were many non-exempt positions that could be classified as exempt, not the other way around.

        Non-exempt staff DO collect comp time here, but that’s because we work a 37.5 hour week. The first 2.5 hours are comp, everything else is overtime. A lot of offices that aren’t budgeted for overtime will allow staff to accumulate comp time during busy periods, so long as it is not abused.

          1. JOTeepe

            Interesting! I’m curious to understand the interplay here with my state vs. others! Will be looking into this further (to satisfy my own curiousity!).

            1. ILurkALot

              I’m at Ohio State University and our non-exempt employees have the option of overtime pay or comp time for hours over 40. We even pay overtime on (most) sick and vacation time, not just hours actually worked! Even our union employees have the option of comp time.

    2. KL

      I work as state employee at a research institution and we are going through the conversion right now.

      1. Anonforthis

        Mine’s said nada about it. My guess, they’re going to make me & others non-exempt.

        1. KL

          We haven’t been told who’s staying and who’s going yet. It’s more of a “We have X positions staying, Y positions changing, and Z positions we need more information about.” We’ve heard that we should be hearing more about it later this month, so maybe we’ll get good news.

  7. Tuckerman

    How will this affect teachers? Will they need to track extra hours if they are grading papers at night?

      1. Elizabeth the Ginger

        This isn’t a factual question at all, but what do you think of teachers being excluded? (I suspect that very very few doctors and lawyers earn less than $47k/year, but many teachers do, which is why I’m asking specifically about them.)

        1. Vanesa

          I was wondering the same thing. I wonder if it has to do with summers off so it kind of works like “comp time”. I feel like teachers should make a lot more than they do.

          1. Observer

            No, because many, many teachers do NOT get paid during the summer.

            More likely it’s because of how difficult it can be to handle (after hours meetings and paperwork can be a major issue) and because, as a society we seem to think that teachers should be paying to do the work. (Why else would it be routine practice to expect teachers to supply a significant proportion of the supplies in their classrooms?)

            1. Aunt Vixen

              Or if they do get paid during the summer, it’s for work they did many months earlier. Those rules about having to be paid within two weeks or the work being completed routinely don’t apply to teachers, who sometimes get paid over 12 months for work it only took them 9 months to do–or, in the alternative, they get paid timely and have to manage their own budgets for the summer. (My public-school-teacher parents always preferred the latter, because they were capable of managing their own budgets and preferred to be the ones earning interest on their money rather than the school board keeping it and doling it out late.)

              1. Vanesa

                I’m not sure, but I have friends who are teachers or who work for public schools and they do get paid during the summer months even though they have the time off. One of my friends is even paid hourly, but she still received a paycheck in June and July when she is off.

                I’m not sure how it works in other districts, but I know those two here do pay them in the summer, and I agree it’s how Aunt Vixen mentioned that they are getting paid for all that extra work they are doing the rest of the year, which is I said maybe they are seeing at “comp time”.

                I agree that as a society our teachers don’t make enough and it so crazy that they have to pay for classroom supplies!

                1. Jeanne

                  Teachers are paid their 9 or 10 month salary for the year. Some school districts allow you to choose to have that pay spread out over 12 months so they don’t have to save for the summer.

                2. Elizabeth the Ginger

                  “One of my friends is even paid hourly, but she still received a paycheck in June and July when she is off.”

                  Huh, that’s interesting! When I was an associate teacher and paid hourly, I got no paychecks during the summer, which was a little rough because I was living in a high cost-of-living area and my hourly wage was only a little more than twice minimum wage anyway…

                3. Aunt Vixen

                  But the summer isn’t time “off” as much as it’s time “unemployed.”

                  My folks never saw it as getting paid for the extra work they were doing over the course of the school year; they saw it as a contract whereby they agree to do X amount of work over a period of nine months and the school board agrees to pay them $Y for it … over a period of twelve months. Work for me for nine months but I’ll take a whole year to pay you for it. In fact, because they were paid biweekly rather than semimonthly, the last payday of year 1 didn’t hit until halfway through the first pay period of year 2. Teachers were on the hook for beginning the next year’s contract before the school board had finished paying them for the previous year’s one.

                  Some folks definitely prefer the steadiness and consistency of the twelve-month pay cycle. My dad hated it. Takes all kinds.

                4. Vanesa

                  That is interesting. Thanks for sharing that information.

                  Aunt Vixen why would you see the time as “unemployed” and not “off”. If they know they are coming back for the next school year isn’t “time off”.

                  Elizabeth, yes she works at the front office and still receives a paycheck. She explained to me that that that is the reason she gets paid once a month only for budget purposes and so they can break out her wage appropriately. She does work at a charter school though, so I am not sure if that makes a difference.

              2. Elizabeth the Ginger

                I’m paid year-round, and kind of prefer it that way – it’s more consistent. It also means I don’t need to worry about things like the automatic monthly transfer from my checking account (where my paychecks land) to the account I share with my husband. I know I’ll always have enough for that transfer to go through because of the paycheck that was deposited about a week earlier.

        2. Pwyll

          You might actually be surprised about the lawyers. There was a case in Massachusetts recently where temporary attorneys doing document review claimed they were not engaged in the practice of law, and some were making below the current threshold or were paid hourly, so they thought they should get overtime (both under the duties and salary tests). They lost, sadly. But there quite a lot of Attorneys who make below 47k.

          For my part, I’m disappointed in the way Teachers are handled in the overtime laws, because they’re among the most underpaid for their time. But if they weren’t exempt, it’d further escalate the public education crisis in most states.

          1. Megs

            If I recall correctly, a couple of other jurisdictions have ruled that doc reviewers are subject to OT rules – I’m in MN and have gotten OT at all three locations I’ve done doc review (I started a bit over a year ago). I believe the key dispute in those cases wasn’t the duties or salaries test, which attorneys are specifically exempted from, but the wording of the attorney exception itself.

            1. Pwyll

              Interesting, I haven’t really looked at other jurisdictions. My recollection was that Massachusetts decided “engaged in the practice of law” was the most important phrase, and that doc reviewers were, in fact, engaged in the practice of law when reviewing information in advance of litigation.

              I found it to be quite the catch-22: doc reviewers want to be paid appropriately for their time, and receive overtime, but at the same time many doc reviewers also want to be able to use the experience as “legal practice” in order to get associate jobs.

          2. zora.dee

            About your last point, yeah, it would be a hardship for a lot of states, but I also feel like it might push state governments to finally start addressing the problem and fix it, darn it!! But obviously, this is just hypothetical.

          3. Elizabeth the Ginger

            Huh, I didn’t know that about lawyers. Thanks.

            I do think it would be a big headache to have teachers track hours for overtime, and would put even more pressure on beginning teachers (who generally have to spend the most time prepping because they don’t have previous years’ lesson plans to draw on). I was once an associate teacher being paid hourly with overtime, and it was frustrating that I had to leave at 3:45 every day even if I wanted to stay and continue working with my lead teacher. But I got in trouble with the administration if I worked overtime aside from specific circumstances. It definitely made me feel like a different class of teacher – one of many things about that school that had a bit of an “upstairs, downstairs” feeling to being an associate vs. a lead teacher.

            1. Vanesa

              I agree! Maybe instead of having the teachers track the hours if it was such a hassle they should just increase starting rate to meet the exempt requirement. Teachers do a lot and work really hard already!

              1. Bay Area teacher

                I know there are associate teachers at my school who make under this cutoff. They’re not lead teachers, and the associate teacher program is meant to be kind of a training experience, but still – this is a part of the country where the cost of living is famously high.

                1. Elysian

                  Assistant teachers are generally non-exempt (or should be). Though every position has to be looked at individually, as a general rule, only lead teachers or true “co-teachers” are exempt.

                2. Vanesa

                  I was interested in this so I looked at the payscale for teachers for several districts in my area and they don’t normally reach the cutoff until the 7th year! The pay starts at 38kish around most districts here. This is for teachers with a BA.

          4. Observer

            I hear your point about teachers, but even though it would raise costs, it might seriously put a dent in the problem. For one thing, there would be no way to keep teachers at the pay level they are at – lots are being paid below minimum wage if you really look at the amount of time the put in. For another it would surface the amount of time that gets spent on non-educational paper-pushing. The combination of the work itself and the way it’s shoved under the rug is hugely demoralizing. Forcing it into the light of day might force some changes.

            1. zora.dee

              Yes, exactly! That is what I have been thinking for a while, I’m glad it makes sense to someone else, too. Thank you!

          5. blackcat

            As a former teacher, I can even say pro-rating the exempt salary to 10/12ths the value would be HUGE. It would be fair, I think, so long as the teachers were genuinely 10 month employees (I have known this to be the case in some districts & schools).

            1. Vanesa

              How many hours would you say you worked in a typical week during the year? If it helps to break it down into different categories (like regular vs conference weeks or whatever you see fit). I am just curious because I know teachers work a lot, but would like to quantify a bit.

              1. Elizabeth the Ginger

                Private school teacher here. During a “regular” week I can actually usually get everything done in just a little over 40 hours a week, maybe 45. During report card time, about two weeks of my life just go 100% to writing reports – I go to school and teach, then go to the library and write, go home and eat box mac-and-cheese and write until 10 or 11 or 12, go to bed and wake up and do it again. About two weekends also go towards report card writing each time. There are some other busier times of year, too, like when the science fair that I run is coming up, or when it’s a busy time for a committee I’m on. I also do some Saturday events during the school year, though some of those have a small stipend as they’re not part of my contract. During the summer, I actually do disengage heavily. This summer I’ve been spending maybe 3-5 hours a week on average doing curriculum planning. It’s definitely a nice perk of the job; I can’t argue it.

                However – I’m about to start my ninth year in the same position. That means I’m able to be much more efficient about lesson/unit planning because most of the time I’m making adjustments to what I did last year, not coming up with new curriculum from scratch. It took a lot more time when I was new. I’m also not, say, a high school English teacher with loads of long essays to grade on a regular basis.

              2. blackcat

                It dropped off rapidly in the three years I taught. My first year, when everything was knew, including a course I was supposed to design(!), I showed up at school at 7ish am, prepped class/lab (science teacher), taught most of 8-3pm, generally with 1-2 hours of prep time in there. I had responsibilities during lunch almost every day. I’d stay at work, either helping kids or prepping labs/activities until 4ish. I’d get home at 4:30, take a couple of hours off, and then work 8-10pm, generally grading. So I guess that’s 11ish hours/day during the week, plus another 4-5 over the course of the weekend. So ballpark 55-65 hours/week, typically.

                When the team I coached was in season, I lost that break in the middle of the day, and would lose one or both weekend days. That was brutal.

                But my my third year, I had everything down to fitting in 40-45 hours/week, except coaching (which I was paid extra for). I got to do things like exercise! And cook! And have a life! Had I kept teaching, I think it would have stabilized at around this amount.

                Both summers on the job, I had trainings/courses that took up 3-4 weeks of the summer. I’d then have 6 or so weeks “off” to varying degrees. I did take 1.5 of the 2 weeks of winter break completely off, and at least half of the week long spring break.

                This was for ~40k in a low COL area, at a private school. I had WAY fewer students than teaching public school, which kept grading work down. Given that I could live really comfortably on that salary, it felt like enough at the time. But I knew teachers at religious schools working just as hard as me for 20-25k.

              3. Vanesa

                That is interesting. Thank you both for sharing. I can see how the first few years would be harder as you are doing the curriculum planning, but later on adjusting the curriculum. Still a lot of work though, but I guess most full-times are no longer 40 hours realistically most employers expect about 45 when you are salary.

                Still not sure why teachers were excluded. I was talking to a friend who was a teacher for 5 years and we speculated that it might be due to budget restraints and if they have to pay higher wages then it might lead to even more overcrowding and this would probably affect districts that are already struggling more.

        3. zora.dee

          Just chiming in, I believe lots of medical residents do earn less than $47k/year. And yes, many teachers do.

          I think that is super lame, IMHO, states should be able to find the money to pay all starting teachers at least $47, it’s not that much, and it’s a pretty reasonable salary for this country’s standard of living. I think they shouldn’t have been excluded, teachers are severely underpaid… I might be biased, my mother is a teacher ;o)

          1. Elizabeth the Ginger

            Hmm, I guess I assumed that even residents generally earned at least $50k, but I guess it probably depends on specialty and part of the country. I do know that residents work insane hours – my sister is a third-year resident and often works more than 60 hours a week.

            1. zora.dee

              Just looked it up, the average resident salary is $51k/year, so I’m sure there are people at hospitals in certain markets who are falling below $47. Kind of lame that they are being excluded.

      2. Perdiem

        Does “doctors” include all medical practitioners, or just certain licensures and degrees? For example, a Certified Registered Nurse Practitioner can be considered a medical provider just like a doctor, but the licensure and training is different. Are they automatically exempt as well?

    1. Female-type Person

      Teachers are considered “learned professionals” and are exempt under a different provision of the law, with no income requirements.

      1. Ask a Manager Post author

        Just to be clear, simply being a “learned professional” doesn’t get you out of the salary test. But teachers, doctors, and lawyers are the three professions that are are exempt from the salary test.

        1. OFer (OP 3)

          I thought the DOL factsheet had no salary test for outside sales. I could be mistaken, though, and if so I need to call my brother-in-law, who asked me about it over the weekend!

          1. Ask a Manager Post author

            Yes, good point, and actually there are some other categories of exception (like employees of movie theaters, many agricultural workers, most railroad workers, and many truck drivers) so that was sloppy of me. But most “learned professionals” are still subject to the salary test.

            1. Rusty Shackelford

              Employees of movie theaters? What’s the rationale behind that? (Or does AMC just have a talented lobbyist?)

              1. Natalie

                The movie theater exemption has been in the law since it was passed in the 30s, so I’m guessing the latter but for some AMC predecessor.

                1. Charlotte Collins

                  I wonder if it has something to do with the way movie theater hours are traditionally worked. There are rushes and a lot of down time (especially for projectionists – remember them?). Maybe it also has something to do with the traditional connection between movie theaters and live theaters… (There are still a few of those left in my city.)

              2. Elizabeth the Ginger

                Yeah, it’s really weird that if your job is to sell sodas and fries at McDonald’s you’re non-exempt (rightly so, I’d say), but if your job is to sell sodas and popcorn at the Cineplex concession stand, you’re exempt… or am I misunderstanding something?

        2. Doodle

          Alison, does this also apply to non-teachers who work in (private) schools? I’m thinking para professionals, coaches who aren’t also teachers, etc. Thanks!

          1. Ask a Manager Post author

            It would depend on whether their primary duty is “teaching, tutoring, instructing or lecturing in the activity of imparting knowledge.”

          2. HRChick

            Also look into the “academic administrators” exemption. The salary test is different for that exemption – equal to or above the salary of teachers employed at the institution

        3. Karen

          I am a manager and I am within the salary test. I am paid salary under the threshold. I want to keep my salary because it pays me whether I’m there or not. If my employer keeps me salaried but pays me overtime when I work over 4o hours is that accepted

  8. Always Anon

    Where I work they are changing how everyone is being paid (from being paid current to being paid arrears) and blaming it on the new salary threshold. Several of our staff will move from being exempt to non-exempt, so is it just better practice to pay in arrears once you have a certain percentage of non-exempt staff?

    1. Sibley

      Current to arrears is easier because you know the actual hours, but you can still pay current, you would just have to make adjustments. They can blame it on whatever they want of course.

      1. Patrick

        To be fair, current can be REALLY annoying if you’re dealing with hourly employees just because there can be a lot of adjustments to make.

    2. irene

      what does “current” vs “arrears” mean? And when I started at my current place of employment, I turned in a time sheet on Day 12 of a 14 day pay period, even though I worked Days 13 and 14 (and my check would come on Day 5 for the previous 14 days). I feel like “current” would be similar to that, but moved back a week maybe?

      1. Natalie

        Basically, you’re just paying upfront. So the paycheck issued January 1st, say, is for the work I will be doing from January 1-January 14, and then on January 15 I get a paycheck that covers the work I’ll be doing through January 31. If you’re paid in arrears, you work January 1-14, and then after payroll processing you get a check on January 21.

  9. Sophia Katt

    It would probably be helpful for those working in nonprofits to see the wrinkles for NPs and the FLSA. And FYI, there is a recorded webinar on FLSA and nonprofits at the NP 501commons website. Thanks for starting this convo as a lot of people still don’t seem to know what’s coming up for them on Dec. 1!

    1. Ask a Manager Post author

      I posted this above, but to put it here too: Nonprofits as organizations are covered by this law if they have $500,000+/year in business revenue. However, even if your organization isn’t covered under that provision, individual employees at nonprofits are covered under the law if they engage in interstate commerce in the course of their work (including making out-of-state phone calls; receiving or sending interstate mail or email; ordering or receiving goods from an out-of-state supplier; and handling credit card transactions or performing the accounting or bookkeeping for such activities).

  10. Frustrated

    Because of the new overtime rules, my organization has decided that no one can earn overtime. What this effectively means is that anytime we end up working over on one day has to be taken off the next day. I am a full supporter of doing things in 40 hours whenever possible, but there are many things my organization does in the community outside of regular work hours (weekends and evenings mostly) that we are still expected to do. This leads to issues of having to take time off for extra tasks on days when this isn’t very convenient for the employee and can be disruptive to the organization as a whole when people have to be off during busy times. Can they require this instead of paying overtime? And if so, what are some suggestions for how to deal with balancing extra duties and getting regular tasks done as well?

    1. Pwyll

      I think the answer contemplated by the rules (which I’m sure is little comfort) is that your organization should be hiring additional people to handle that work. Basically, if your non-exempt staff aren’t able to finish their work in 40 hours per week, your organization is understaffed. So the work needs to be spread, or people need to get paid extra to be over-worked.

      Recognizing that money doesn’t grow on trees, however, I think your question of how to balance goes back to the standard types of advice Alison gives on this site: have a conversation with your manager to discuss the priorities of your work and how to best accomplish them in the 40 hour period that is now mandated by your company.

    2. BAS

      Depending on what state you live in, that sort of hour carryover isn’t always legal/circumnavigating OT rules/laws. It particularly doesn’t work in California.

      1. Elizabeth the Ginger

        It’s legal in most states – from this source it seems like it’s fine except:

        Alaska, California, Nevada – overtime must be paid for anything above 8 hours in a day

        Colorado – more than 12 hours in a given day or 12 consecutive hours

        Oregon – more than 10 hours in a given day, but only in some industries (like factories)

        Kentucky – the 7th day worked in a workweek is subject to overtime

        Rhode Island – retail and some other industries must pay overtime for Sundays and holidays

  11. ashleyh

    Do I recall correctly that bonuses can be counted towards the threshold amount? What about commission pay?

    1. Ask a Manager Post author

      Up to 10% of the salary level used to make the calculation can come from non-discretionary bonuses, incentive payment, and commissions. (Previously, there’s been no provision to count those.)

      1. Dr. Ruthless

        Clarifying question:

        Let’s say that I have an employee, who I pay $45,000. She will earn a 10% bonus after working a year (so, $4500), making her total compensation (if she stays for a whole year) $49,500.

        Does this pass the salary test? Does a longevity (one year) bonus (written into employment offers) count as non-discretionary?

        1. OFer (OP 3)

          A bonus is non-discretionary if it is announced in advance, as an “if-then” scenario; this can be longevity, other milestones, meeting professional goals, profit sharing, as long as it’s clear in advance what the employee must do to earn the bonus, and how the bonus is calculated. If an employee is salaried at $45,000 and an employer is counting on the bonus to bump them into an exemption, but they don’t meet the requirements of the bonus, then they’re either retroactively non-exempt (and thus have to be paid all that overtime), or the employer can make a one-time (annual) catch-up payment up to a certain limit (I’m sorry, I don’t remember the exact amount). In this case, I’m pretty sure the catch-up payment would be the difference between their weekly gross pay and the new threshold (prorated by the number of weeks worked).

        2. Anomanom

          No, the other part of that is that the bonuses or commissions must be paid a minimum of quarterly to count. So annual bonuses don’t work.

          1. Patrick

            This is a great callout – I have seen the info about bonuses counting towards the threshold, but I hadn’t heard this.

      2. Jesmlet

        I’m a little confused about this too. I currently make $31,200 base salary but my commission will be around $18,000 plus bonuses which are harder to predict. If it’s only 10%, then that would put it at 33k which would qualify me for this new law even though I make around 50k/year, yes?

            1. OFer (OP 3)

              Outside sales is specifically excluded from the salary test, but I don’t know about recruiting (which I’m assuming doesn’t have a “sale of goods or services” component). If I were in charge of how you’re being compensated, I’d probably restructure your compensation so that your base pay met the threshold, and restructure the commission/bonus part of your compensation so that these don’t kick in until you would have earned that much under the previous scheme–basically setting a minimum production level that must be met before commission kicks in on anything over that, or else just lowering the commission rates across the board. I had a relative who worked in inside sales, whose company was treating them as outside sales for salary purposes, and they got turned in to the DOL and had to make up back pay for everyone; going forward, they increased base pay and cut commission rates to compensate, then put anyone who didn’t meet the minimum sales level to make up for the increased salary on PIP. It sucks, but if your employer can’t afford to “eat” the cost of just increasing your salary and still pay your customary commissions and bonuses, that’s one way they could mitigate it.

  12. E.S.

    I notice that the woman being paid $39,000 in Comment #3 is making 70% of the man being paid $55,000 for the same work was.

    Wow.

    1. OFer (OP 3)

      When she was hired, she had only one year of teapot-specific experience, had only ever worked hourly before at places with rigid pay scales, and didn’t know negotiating was even possible. Now she has 4+ years experience, and has gotten $6,500 in raises in the last three years, whereas he was hired in with around 3 years experience and negotiated up from $49,000 to $55,000, which required board approval so word got around. She’s still getting hosed, but the relative bargaining power of someone being hired off unemployment with little experience isn’t the same as that of someone being hired away from another job with a good track record. Hopefully they will make it right (or close enough to right) soon, but if they don’t there are a good number of job postings locally for the same skills and experience, with much better listed salary ranges. She loves the work she does, and doesn’t want to leave, but if they try to cut her base pay she’s jumping ship–she already has a couple of recruiters sniffing around unsolicited.

      1. MK

        How sure are you about the other person’s salary? It sounds to me that the info is based on gossip, so maybe it’s not a good idea for your wife to use it in her negotiation.

    2. OFer (OP 3)

      They tried to hide the discrepancy a bit by hiring him in at a higher title, but if his resume deserved that title, then so did hers.

  13. IT Kat

    While both my duties and salary make the law a moot point for me (I make more, and I meet the duties test), I know that the IT Help Desk person in the office is considered “salaried” (i.e., they treat him as exempt even though I know he’d fail the duties test – I don’t know his salary, but I doubt it meets the new minimum), and I don’t think he’s aware of the law and that he shouldn’t be considered “salaried”. I’ve tried to gently suggest he do some research on it, but he’s fairly new to the workforce and laws like this are confusing.

    Is there a good way to bring up the new law with HR or our manager without making it seem like butting in where I don’t belong? Or should I just let it go?

    1. Megs

      Salaried and non-exempt are two different things – although it’s not terribly common, one can certainly be salaried (paid regardless of hours worked up to 40 hours) and non-exempt (eligible for overtime pay). So the concern here only comes into play if he’s working more than 40/hours a week without being paid for it. If you think this is the case, you could certainly suggest he bring it up with HR.

      1. fposte

        I think salaried non-exempt is going to be a lot more common as a result of the threshold change, because it’s one of the easiest ways to deal with it.

      2. IT Kat

        I didn’t explain well – I put “salaried” in quotes because I know he works more than 40 hours and doesn’t get paid for it. They’re treating him as if exempt.

      1. IT Kat

        Hmm… are you sure he meets that exemption? This is the explanation from a link I’ll post in a follow-up comment:

        Computer employee exemption
        To qualify for the computer employee exemption, the following duties requirements must be
        satisfied:
        • The employee must be employed as a computer systems analyst, computer programmer,
        software engineer, or other similarly skilled worker in the computer field; and
        • The employee’s primary duty must consist of:
        1. The application of systems analysis techniques and procedures, including consulting
        with users, to determine hardware, software, or system functional specifications;
        WHD | Small Entity Compliance Guide to the Fair Labor Standards Act’s “White Collar” Exemptions 9
        2. The design, development, documentation, analysis, creation, testing, or modification of
        computer systems or programs, including prototypes, based on and related to user or
        system design specifications;
        3. The design, documentation, testing, creation or modification of computer programs
        related to machine operating systems; or
        4. A combination of the aforementioned duties, the performance of which requires the
        same level of skills.

        All of those are for learned professions, not helpdesk. If you’ll notice, it specifically calls out “The employee must be employed as a computer systems analyst, computer programmer,
        software engineer, or other similarly skilled worker in the computer field” and those are all professions that are at a higher level than a help desk technician, usually requiring at least a bachelor’s degree or an array of certifications, which help desk does not.

          1. Megs

            And it looks like you STILL have to meet the salary test, even if you also meet the duties test via the computer exemption: “Exempt computer employees may be paid at least $913 per week, or on an
            hourly basis of at least $27.63 an hour.” That’s what’s really being addressed with this new law: people who meet the various white collar exemptions also must meet a minimum salary cap* – the law is raising that cap significantly.

            *With the exception of lawyers, doctors, teachers, and outside sales employees.

            1. IT Kat

              Agreed, I didn’t doubt that!

              Honestly I see so often people lump help desk into “they work with computers, so they should be exempt” when they shouldn’t be.

              1. Megs

                Oh yeah, for sure – honestly, the interaction between the two tests is confusing enough that I know I didn’t have a good grasp of it until I went to law school (ironically rendering said test generally moot).

        1. SirTechSpec

          Yeah, misclassifying people who meet the salary test (which is pretty obvious and objective) as exempt, even if they really fail the duties test and should be non-exempt, is standard business practice in so many cases, including IT employees. It’s one reason they raised the salary test IMO, but that obviously won’t fix all problems.

  14. KL

    Has anyone else heard about losing/chaning duties? I’m at a large research institution and we’ve been told that if we we meet the duties test, but not the salary test and there is not enough money to bring us up to the minimum, then we will be losing/changing duties.

    1. fposte

      That’s going to be an employer policy call; it seems fairly sensible of your employer to realize that keeping you to 40 hours per week means you won’t be able to get the same amount done, though.

    2. Patrick

      My understanding is that employers are always free to pay someone hourly even if their job qualifies as exempt if that’s what you’re asking.

      Like fposte said, it’s probably wise of your employer to reduce workload if they can’t afford to bump people up to the new threshold.

      1. KL

        I think my understanding is a bit different than yours. We were told that our duties must be less than 50% “exempt” duties, otherwise we’d have to get a pay bump to stay exempt. If your position is moving to non-exempt, then you’re likely going to lose a few duties. I don’t think I fall into this category, but more than a few people in my organization are viewing these changes to their positions as demotions.

        1. SirTechSpec

          That doesn’t make sense. Setting aside the specific professions that have weird rules, it works like this:
          -By default under the FLSA, your employer must pay overtime to anyone who works more than 40 hours in a week (whether hourly or salaried).
          -If you make more than the salary threshold AND your duties fit certain requirements, you can be exempt from the requirement to get paid overtime.

          So if someone makes less than the salary threshold, no amount of reshuffling duties is going to get your employer out of the responsibility to pay them overtime. So there should be no reason to change anyone’s duties, except perhaps as necessary to enable you to get everything done in 40h/wk.

          Is it possible that your empoyer is planning to *move* all the duties that could be done by exempt people to folks who will still be exempt, in order to make them work overtime (which can be unpaid) instead of you (who would have to be paid for it)?

  15. Sooo

    What about people who do a 37.5 hour week, are exempt, and treated just like any 40 hour/week job as in I have benefits, etc.?
    A raise to meet the threshold is not happening. I’m really not happy about this new rule because in my field there is a perceived prestige about being hourly v. salaried and if I have to adhere to rigid schedule requirements and account for every second of my time that really takes a lot of the positive things away from the job. The flexibility was a big attraction since the pay is so low. The HR person even pointed that out when I was hired! Also, there is never actually a need for me to work overtime in this position. I am really unhappy because keeping track of all the time sheets is a huge bunch of extra work and I strongly suspect my employer may try to not only make my position hourly but also part-time because of this new rule.

    Don’t get me wrong: I think the law is good for helping people who have been taken advantage of but I am not one of those people and it is actually hurting me.

    1. Murphy

      You can be salaried, non-exempt. You don’t have to be made hourly.

      For example (note, I’m not in the US, but the situation mirrors your situation a bit), my staff are all salaried, but they’re also eligible for overtime when they work more than 36.25 hours/week (our full-time hours). For my staff they only submit a timesheet when they have hours to report, either PTO taken or overtime to account for. Otherwise they’re just considered salaried and don’t have to track hours. This gives them the flexibility to work as any other salaried employee (i.e. they can come in late one day and leave early another and just make-up the time), but if I ask them to work over their usual amount I’m paying them for it (rarely happens, I jealously guard my staff’s free time).

      So it can work even if you’re below the threshold if your employer wants to set it up that way.

      1. Sooo

        My employer is subject to the whims of our state legislature, so I am not feeling optimistic, but thanks for the explanation. There is absolutely no reason to do overtime in my position but I do like to sometimes work odd hours if I need to leave early or come in late. Then there is this side-project I do that I am not sure if it will be an issue. We have some aquariums in the lobby and I help the boss look after them in addition to my other duties. Sometimes I like to deal with the aquarium on the weekend because I’m not interfering with normal business-day activities and I do come in over holiday breaks occasionally. Then there are the times, like today, when I sit and….ummm….supervise something for one of the higher-ups. Said higher-ups will definitely stay exempt and generally show their appreciation for my standing in by buying me lunch, although it could be considered “other duties as assigned”. It would be pretty normal to ask the secretary to do the same kind of supervision I was just doing as part of their regular “other duties as assigned”. I see all of this being forbidden after the 1st of December. Mostly I am afraid I’m going to lose my benefits and have to stick to draconian time keeping. I am sort of hoping that if the latter happens the boss will allow me to turn in 8 hour time sheets even if I actually did 7 hours one day and 9 the next.

        1. STX

          I don’t see why any of those duties would be forbidden after December 1st, including weekend and holiday work, as long as your overtime is tracked and you are compensated for it. AFAIK, “holiday pay” or “late-shift pay” is a matter of company policy, not a state or federal law.

          1. STX

            (Or, I suppose a matter for a union contract that covers all “non-exempt employees” rather than all “hourly employees.” That would be a question for the union representative.)

          2. fposte

            I think there’s kind of an interesting class thing here, in that a big convention of exempt status is flexibility and tracking your own time–in other words, in being trusted to get your work done when it’s supposed to. But there’s no reason why non-exempt people can’t be trusted to get their work done when it’s supposed to and work flexibly too. Maybe that will be one takeaway from this.

    2. STX

      There is NO requirement for non-exempt employees to be paid hourly. I repeat, you can be a non-exempt worker paid a salary for any hours 40 and under in a week. Your employer can keep you at your current salary, on a flexible schedule, although your employer will need to track your actual time worked. If you never need to work overtime, this seems like a good compromise.

    3. nonpartisan

      We’re in the same awful position and I’ve worked where I am for over 16 years.

      I don’t want to hear from people, not in the same position, that employers don’t have to make us hourly, per the law. That they can make us salaried non-exempt. Of course employers CAN. But the majority AREN’T. Instead they’re converting salaried exempt to hourly to make it easier on their budgets. They don’t care about the effects on employees. No matter what anyone says – It IS a demotion.

      The OT law is doing the opposite of what it’s intended to – Put money into middle class pockets. Instead it’s taking money OUT of our pockets! The rule doesn’t take into consideration regional differences. $50,000 here is a very high salary compared to somewhere like NYC that’s a few hours away. Hourly employees have to be paid on a different schedule than salaried. We’re only getting half a paycheck in November due to that schedule. Half a paycheck that will still have full month’s deductions taken out of it.

      There’s no recourse when it’s a university medical center of about 20,000 employees and it’s across the board. The law is hurting every single salaried to hourly employee here. We’re in the thousands. Salaried part time employees, who enjoy a lot of the same perks as full time, are being changed to hourly too. They’re losing even more benefits than us full time who are “reclassified” salaried to hourly.

      No more steady paycheck. Instead of a salary we can depend on it’ll be variable. We’ll get paid, in arrears, just for what we work, down to the very minute. Our paychecks will already be $300 less a month, mind you. IF we work a full 40 hours. Working less than 40 hours means an even smaller paycheck. We never work 40 hours. Hours are capped, even for salaried employees . Anyone hourly who consistently works overtime without approval will be terminated. Overtime is never approved. None of us will ever see the supposed “benefits” of being eligible for overtime.

      Soon we’ll be punching in and punching out. No more telecommuting because it’ll be too difficult to track. No more flexibility. Those who don’t think that’s so bad obviously don’t have kids or leave often for appointments. Salaried employees get “unlimited” time for appointments and sick days. Now we’ll only get 40 hours of PTO per YEAR to be used for all appointments and sick time. No more making up the time. We can choose to not get paid but that would reduce already leaner paychecks.

      Vacation time can be used for appointments and sick time of course. However, accrual is less for hourly employees than salaried. Not only do we lose “unlimited” time for appointments, we’ll be getting less vacation hours per year too. If we have to use vacation when we’ve used up PTO, that means even less vacation time for actual vacations from already reduced vacation banks.

      In fact, the entire benefits package – short term disability, life insurance, health insurance – is a fraction of what salaried employees receive. We’re losing benefits and some are significantly reduced. The amount of money taken out of checks for parking and health insurance doesn’t change. In fact, those increase. Which means even less in our severely diminished paychecks.

      I fail to see how any of this is a benefit or good for the middle class or the economy. All it’s done is make things much worse for people who are already struggling financially. It’s also become a partisan issue which it shouldn’t be. Everyone has to stop making it about GOP vs Dem and make it about the American people. I’m registered Dem but liberal policymakers need to seriously consider the disastrous consequences of their rules and regulations!

      I guess this is my TL;DR way of saying – I agree and am in the same sinking boat as you.

  16. Sarah L.

    Our organization has different benefits for exempt and non-exempt employees (mostly in terms of how and how much sick time and vacations accrue; exempt employees get significantly more of both). There are likely to be a fair number of employees that are currently exempt that are bumped into non-exempt. I am guessing that this is an internal policy that my organization will have to manage – perhaps have a special category of benefits, but I’m wondering if you have thoughts on that (which I’d imagine would be playing out across many organizations).

    1. Charlotte Collins

      My company is similar. We actually have two categories of non-exempt workers.

      Let’s just say that the way they handled it made me kick up my job search.

  17. NylaW

    I believe licensed professionals, computer professionals, and outside sales are all unaffected right? THis is just a change to the “final rule” that checks salary after other requirements have also been met. This seems to be the sticking point with our HR and with a lot of people. They are so focused on the new salary rule, they are ignoring the other things that allow certain positions to remain exempt even if they don’t meet this new salary.

    It might be helpful to have an addendum to the post that lists the parts that are NOT changing.

    1. Ask a Manager Post author

      Outside sales professionals are inherently non-exempt, like teachers, doctors, and lawyers. (They’re not subject to the salary test.)

      The same is not true of computer professionals or licensed professionals; they are still subject to the salary test, and if they don’t meet it, they are non-exempt.

      1. fposte

        I think you mean “inherently exempt” in the first sentence. (I wish it were a different term because “non-exempt” feels like a double negative and I always have to walk myself through it.)

  18. The_artist_formerly_known_as_Anon-2

    And although it’s a different topic – it is related. Many may hear this and be fooled into declining overtime pay are lied to “if you get more money you will be penalized, you’ll end up in a different tax bracket. ”

    It might be high-time for AAM to guest-host a tax expert to explain how income taxes are graduated in the United States and how you will not be penalized if you get a raise.

    1. Sibley

      AAM, please do. I’m an accountant (not writing your guest column though, sorry!) and the number of people who are clueless in the US is pitiful. Also, please explain that just because 25% or 50% is withheld from your bonus doesn’t mean the government took it… it all comes out in the wash when you file your tax return.

      1. The_artist_formerly_known_as_Anon-2

        Yes, we saw some letter from people wanting to negotiate a LOWER salary because they were afraid of the brackets. Some employers exploit the ignorance of employees on this. Some years back, a bozo manager tried to do that with me and I quickly informed him that he was a master at one thing = insulting my intelligence.

        Yet others thought because their refund in 2016 was lower than 2015, that they lost money due to a raise.

        While some have extremely complicated tax situations, I doubt that the majority of people on this board have such a predicament – I advised = “BUY a tax processing package – not the freebies, but the ones that cost $25-40 – and do your OWN taxes.” That is probably the best way to learn how this all works – AND – get a grip on one’s own finances at the same time.

        Believe it or not – I have known some people who told me “I don’t pay taxes, I haven’t paid them in eight years”… they actually think that because they got refund checks, they didn’t pay any taxes.

        Alternatively – sit with an accountant who does your taxes and have him/her explain EVERYTHING on that 1040. Unfortunately, people leave their paper work, are told “You’re gonna get a refund of $645” and they run up and down the street “whoo-hoo!”

        I’m getting carried away here, but, you know that some employers will tell people that getting a raise is bad for you. Certainly, if you were in the $45,000 area, and worked a lot of extra hours – the boss will give you a raise to duck the overtime issue. And some will claim = “oh we’re exempt from that” when they are not.

      2. Whiskey Tango Foxtrot

        IME, people who say the government took it don’t actually believe that, they’re just trying to stir shit, and they often *want* to believe the government is taking more money than they really are.

    2. Whiskey Tango Foxtrot

      Yes, a lot of people do not understand that the extra % tax is only paid on every dollar above the previous threshold.

  19. CrazyCatLady

    I talked to my boss about this, and if she gets approval, I will hopefully get a raise to keep me exempt. However, I work in non-profit and I’m really afraid that we won’t have the funding for this and I will go non-exempt. I recently learned that the PTO package for non-exempt employees here is exactly half of what I am currently receiving as a salaried employee. They base PTO on the amount of time you are here, and since most people at this non-profit have been here for ages, making the transition will not affect their PTO (you have to be here for 10 years to make the amount of PTO that I currently have). When I negotiated my salary under a year ago in December of 2015, I was willing to take a lower salary than I could get elsewhere due to the generous amount of PTO and worklife balance. Losing half of my PTO would be a real deal breaker for me. Is there any argument that I could make to keep my PTO if I am made non-exempt?

    1. Natalie

      Sure, I don’t see why not. There’s no legal requirement that they give you a different PTO package now that they’re reclassifying you, it’s just an internal policy. You can negotiate for the PTO to stay the same.

  20. audrey

    I have a question that’s kinda like #4 in the post. I was hired at a company as a temp in July of last year. I was made permanent in September, then promoted into another role (with a salary bump) in December.

    My one-year in this role, then, is in December, just a matter of days after the new overtime law takes effect. My current salary is under the $47,476 threshold but not by much (less than $2k under the threshold.) I want to negotiate for a raise at my one-year mark but the new overtime law complicates things. I know they will bring me up to the new threshold because my job requires a significant amount of overtime. How do I ask for a merit raise on top of the raise I’m expecting due to the new law?

    I’m thinking I’ll say that since the new law bumps my salary up by about 2-3%, I want to ask for a 1% bump (based on my current salary) in addition to that as a merit raise. Is that fair? When do I ask about this?

  21. DaniCalifornia

    I don’t understand the duties part and how they would pay you for overtime if you were salaried but below the new limit. I make 48K doing bookkeeping/admin work so I know it doesn’t affect me, but my coworker is the receptionist/personal asst/admin and makes 43K. Another bookkeeper/admin makes 30K.

    1. Does this law apply to all businesses? We have 9 FT salaried employees?
    2. Does being the receptionist/admin fall under the duties part?
    3. If our receptionist does meet the criteria, how does overtime pay work if her salary isn’t increased? We are busy from Jan – Apr and Sept – Oct for tax season, often working weekends and more than 40 hours. Essentially she makes approx $20.67/hr so if she works 45 hours one week would she receive her normal net pay plus $103 dollars (with additional taxes taken out)?

    I’m sure some people find these laws fun but my head hurts reading and trying to figure it out.

    1. Ask a Manager Post author

      1. Yes, regardless of size. (If you were a nonprofit, it’s possible you might be exempt but only if the organization and the employees met certain condition– see above.)
      2. A receptionist is almost certainly non-exempt / would fail the duties part of the test for exemption.
      3. They will have to pay her overtime for all hours over 40 in a week (time and a half).

      1. NP

        If the receptionist is non-exempt under the new law due to failing the duties test, isn’t she also non-exempt now? So wouldn’t she already be paid overtime?

        1. Ask a Manager Post author

          Yep. But it sounds like they haven’t been doing that, which would mean they’ve been breaking the law (probably unknowingly, which is pretty common).

          1. DaniCalifornia

            Yes we have been, but I can promise its unknowingly. With no HR and 9 employees (most accountants), we plan on presenting to the owner and make him aware of everything. We only really work overtime during tax season. My guess is he’ll bump her up over the new threshold since it’d be cheaper than paying OT.

            1. Ask a Manager Post author

              She still will be non-exempt though, because she won’t meet the duties part of the test — so bumping her up probably doesn’t make sense (and definitely won’t solve it).

              1. DaniCalifornia

                I think…think… the light bulb just went off in my head. Ok, yes you’re right it won’t solve it. Just to be clear since I’m also an admin/bookkeeper who fails the duties test and I make 48K I am non exempt and should be paid OT? (If I have this wrong I think I am just going to fly away forever!)

                I hope you are showered with chocolates from the chocolate fairy for answering all of our questions.

                1. Natalie

                  Sounds like it. STX posted this “And Gate” below that should help:

                  A) An employee fails both the duties and the salary test: Not Exempt
                  B) An employee fails the duties test but passes the salary test: Not Exempt
                  C) An employee passes the duties test but isn’t paid enough: Not Exempt
                  D) An employee passes both tests: Exempt

            2. Sara

              Um, the point here is that she should be non-exempt regardless of salary! You have to pass BOTH the salary and the duties test to be exempt. Since a receptionist’s duties do not pass the duties test, she should be classified as non-exempt and making overtime regardless of what her salary is.

    2. fposte

      Yes, the law applies to all businesses. It’s possible your co-worker shouldn’t have been exempt in the first place–those don’t sound like exempt duties. However, it’s up to the business to decide whether they’ll pay her the same and limit her to 40 hours (easiest on the paperwork side, but obviously difficult if you need her more hours per week), or budget the same for her pay over the whole year and figure her hourly rate based on an expectation of a certain amount of overtime, meaning her pay will go up and down throughout the year.

    3. RedinSC

      For DaniCalifornia, If you are actually working in CA, the over time rules are actually different than the federal rules anyway, with regards to salary. Currently, in CA to be exempt, you do need to meet the duties and salary rules, but the salary is actually twice minimum wage. In CA, that minimum wage is currently $10/hour and moving to $15/hour by 2020, I believe. So right now to be an exempt employee you need to be making at least $41,600/year and by 2020 you’ll need to making over $62K/year to remain exempt.

      So right now, (not looking at the duties portion) the person making $30K also can’t be exempt in CA because of our different salary requirements. This is something to keep in mind as in just 2 years employees in CA will need to be making nearly $50K to remain exempt.

  22. AnonForThis

    On a PIP, will be off of it, fired, or at a new job before December 1. Full time, exempt, 45k / year, at a small non-profit with maybe 3 out of state phone calls per year and no interstate travel. Does the non-profit exception apply? If not, should I raise the overtime law thing now or wait until the PIP is resolved? Thanks so much for this post!

  23. Larina

    I also have a question related to #4.

    I was recently promoted within my company, but to a position with a much lower salary than I was hoping for. I’m well under the new minimum for being exempt, and I’m trying to figure out when a good time to approach my manager about the consequences of the new law in regards to my position. My department frequently has overtime/weekend work for my position and similar positions, and until now it’s all been “well, you’re exempt, so you gotta.” There’s been no discussion or mention from my manager or anyone aside from my peers about the law (and then it’s mostly: I can’t wait until December and they have to start paying us overtime).

    Since I’m so new and management hasn’t addressed the new law, is there an ideal time or way to approach this?

  24. Noah

    My employer (an airline) announced this week that this doesn’t matter for our employees because they are “any employee of a carrier by air subject to the provisions of title II of the Railway Labor Act”. Something along the lines of it doesn’t really matter because we don’t have to pay people overtime under the law anyways. Lots of unhappy admin staff right now who all thought they would be receiving a raise in December.

  25. em2mb

    I work for a university with a very different benefit structure for hourly non-exempt employees than exempt employees. I’m currently an exempt employee making $42K a year. I know there’s talk of moving some of us in my department in critical roles up so we’re over the threshold, but the only official word we’ve gotten is we *might* be reclassified. Is there any accounting in the rule change for when that would mean a significant loss of benefits? Right now, I get 21 vacation days and 12 sick days, and that would plummet to 12 vacation days if I were suddenly non-exempt. Does it matter that the benefits package was spelled out in my offer letter? Would I lose sick days I had banked now? I wouldn’t have accepted this job at this salary if not for the time off!

    1. Natalie

      There’s no accounting for benefits, as benefits aren’t at all covered by these wage and hour laws. Your employer is perfectly free to not make changes to your benefits if they’re willing to flex their policy.

    2. HRChick

      Your employer may do like we are – those being reclassified as a result of these changes are retaining their exempt benefits that they were recruited with

    3. Elizabeth the Ginger

      My understanding is that there’s nothing in the law specifying anything about vacation days. If your company currently offers different numbers of vacation days to their exempt vs. non-exempt employees, that’s completely at your company’s discretion – legally they’re not obligated to offer anyone any vacation days.

      I would bring this up with your manager and/or HR proactively, stating how important the vacation time is to you, rather than waiting to find out what they decide. I agree with you that it would be quite a blow to have your benefits suddenly diminish greatly.

    4. TCO

      I also work at a public university, and we got reclassified from exempt to non-exempt about 9 months ago (partially because this change was anticipated–our department staff in these job classifications all made above the new threshold but that wasn’t always the case in other departments). We lost nearly all of our exempt benefits and got moved to the lower PTO accruals. In fact, we went from “unlimited” sick time to 13 days and started with an accrual of zero days when the change happened. It sucked.

      Our department’s leadership fought the change but ultimately couldn’t protect our team from the bureaucracy. I hope your job fares better than mine did, but there are no guarantees!

      1. em2mb

        Honestly? I could stomach accruing at a slower rate while I searched for a new job, but if they reduced my existing bank to zero (especially since under the current structure, unused sick time is counted toward your pension), I’d probably quit on spot. To go from 21 vacation days and 12 sick days to 12 PTO days and NO sick bank? Not worth it when I could easily be making $10K more in the private sector.

        1. TCO

          Believe me, we all did some job searching. The good news is that our pay is quite competitive, so that was a retaining factor.

      2. nonpartisan

        The same is happening to us at a university medical center. Salaried are converted to hourly. We get a fraction of the vacation accrual. Only 5 days PTO, instead of “unlimited”, for everything from appointments to sick time. They keep saying it’s not a demotion but it is. They’re the largest employer in this economically depressed and small city. Finding a new job is not an option.

  26. Biff

    Alison — in some states where I’ve lived, overtime pay was NOT equal to time-and-a-half, it was just your usual rate. Does this mean that now overtime must be paid as time-and-a-half, not simply time?

    1. Ask a Manager Post author

      What state? The federal law requires it regardless; states can offer more protections than the federal law, but not less. That makes me wonder if you were actually exempt and it was just about your company’s own voluntary overtime pay (as opposed to law).

      1. Biff

        No, I was in Washington when this happened, about 10 years ago. I’m going to assume it was illegal and I just didn’t realize it.

        Thank you for the answer.

        1. Elizabeth the Ginger

          You also might have been in some industry that’s an exception – for example, if you worked at a movie theater (even if your job was sweeping up popcorn after movies) then it was legal. I just learned up-thread that for some reason movie theater employees are all classified as exempt from overtime for reasons that may or may not have made sense in 1934 when the law was written…

    2. Meg

      Are you sure you were being paid actual overtime and not just for all hours worked? (Hourly non-exempt)

      I’ve been hourly non-exempt as a (sub) contractor for nearly 5 years. I got paid for all hours worked, but only at my usual hourly rate, never the official overtime 1.5x rate. They were never classified as overtime either. For the sake of timecards though, anything over 40 hours was marked at OT, but because of my non-exempt status, I wasn’t eligible for 1.5x rate, but because of my hourly pay, I still got paid for those hours worked.

  27. writelhd

    I’m confused on whether or not my job falls under the “learned professional” exemption to this rule. My profession is so obscure it’s not going to be something that the government thinks to make rules on. I figure the learned professional exemption is meant for doctors and lawyers…what about engineers or other technical experts? If engineers…only licensed professional engineers? It just says the knowledge has to be gained through schooling… but the exemption is not clear on if a specific schooling or licensing, or specifically post-bachelors schooling, is what is mean there.

    My job is an obscure branch of engineering and I’m a technical expert–70% of my role is advising clients and coworkers on matters related to my area of expertise, 30% of my role is “anything else that needs to be done” including assisting in quoting certain products or general customer service. A technical 4-year bachelors degree of some kind is required–we don’t specify engineering or physics or chemistry or what have you, just something with enough science and tech in it, probably leaning heavy toward engineering. I am the manager of my department.

    1. Ask a Manager Post author

      “Learned professional” can qualify you for the duties part of the test, but you’d still need to meet the salary part of the test (unless you are a doctor, teacher, or lawyer, in which case you don’t).

    2. Countess Boochie Flagrante

      As Alison said above, the “learned professional” is specifically doctors, lawyers, and teachers.

      1. Ask a Manager Post author

        It’s actually more confusing than that. “Learned professional” covers a whole range of jobs (like CPAs, engineers, architects, etc.). They meet the duties test but still need to meet the salary test. However, a subset within “learned professionals” is doctors, lawyers, and teachers, and those three do not need to meet the salary test; they are automatically exempt.

      2. Ultraviolet

        Not quite–doctors, lawyers, and teachers are a subset of learned professionals who don’t have to meet the salary test for exemption.

  28. LadyKelvin

    What about post doctoral positions? Are they exempt under the “learned professional” position? Or will they have to either pay more than the minimum or be hourly? Postdocs are usually expected to work long hours and make less than $47K.

    1. Pwyll

      If you’re a post-doc researcher in a position that requires a Ph.D. you’re almost certainly exempt as a learned professional. If your primary duty as a post-doc is teaching undergrads, you might also fall under the teacher exception.

      1. Pwyll

        To clarify: post-docs whose primary job isn’t teaching would be exempt under the duties test of the learned professional exemption, but would still need to make more than 47K under the salary test.

    2. OP #1

      Where I work (not as a postdoc, but occasionally hiring them), the postdoc department makes it super-duper clear that postdocs are in a unique employment position that’s neither staff, student, nor prof track. I imagine it’s different all over, but here they’re effectively guest researchers who are affiliated with the school and have some benefits, but aren’t in the staff category.

      1. Ultraviolet

        I never know whether it’s weird to post two times in the same thread making the same point…but FYI the DOL factsheet on higher ed definitely sounds like postdocs must be considered as staff for purposes of exemption or non-exemption.

        1. fposte

          Or to put it another way, the DOL doesn’t care what you call them as long as you don’t call them exempt if they’re making under $47,476.

          1. Ultraviolet

            You also can’t try to call them students, which is worth calling out since thinking of postdocs as being student-like somehow is (I would guess) the foundation for most attempts to get out of thinking of them as employees.

      2. Honeybee

        This is not directed at you, OP, but rather universities that do this – but quite frankly, it’s bullshit. I was a postdoctoral researcher for a year and postdocs do much of the same job duties that a professor or associate research scientist or research associate would do. Some places try to make the professional development the linchpin, but there’s professional development and mentorship in every job. It irritates me when universities classify postdocs in some ghosty third/fourth category that strips them of benefits and makes it difficult for them to get stuff. The guest researcher thing is especially galling, since postdocs in biomedical labs certainly aren’t treated like guest researchers with the flexibility and autonomy that guest researchers have. (At my university, I was classified as staff and got the same benefits as the staff. It was great.)

        Seems like so many universities want to have their cake and eat it too – long hours of highly trained scientist labor at a low low price.

        (Again, not directed at you, OP #1.)

    3. fposte

      Postdocs are still subject to the salary threshold, so they will become non-exempt. Yeah, it’s going to be interesting.

    4. Ultraviolet

      DOL factsheet says:
      Postdoctoral researchers:
      – Sciences: Postdoctoral researchers in the sciences are not covered by the teaching exemption. These employees are generally considered professional employees and are subject to the salary threshold for exemption from overtime. DOL has been working closely with NIH and NSF regarding their mutual interest in this area.

    5. STX

      For one data point, The University of Pittsburgh is giving all “Postdoctoral Associates” (aka, postdocs employed by their PI on an existing R01 grant) a raise to bump them above the salary threshhold. “Postdoctoral Scholars” are paid by outside funding/training grants and thus are not employees subject to FLSA.

      1. Honeybee

        I wonder if that second category is going to hold. If postdoctoral scholars are doing the exact same thing that postdoctoral associates are doing, it doesn’t matter where their money is coming from. What matters are the duties they’re performing. If the first group is non-exempt below the threshold it follows that the second group is also non-exempt.

    6. Honeybee

      I was curious about this myself. Postdoctoral fellows are almost certainly learned professionals.

      The NIH released a statement on this, essentially saying that they are raising the NRSA postdoc minimum salary to the exempt threshold: https://nexus.od.nih.gov/all/2016/05/18/nih-flsa-2016/. They also say this:

      Institutions that employ postdocs through non-NRSA support can choose how to follow the new rule. They may choose to carefully track their postdocs’ hours and pay overtime. Or, keeping with the fact that biomedical research – as in many professional and scientific careers – does not fit into neatly defined hourly shifts, institutions can choose to raise salaries to the new FLSA salary threshold or above it, if they do not yet pay postdocs at or above that level.

      HuffPo also posted an article about this, cowritten by the director of the NIH and the U.S. Secretary of Labor: http://www.huffingtonpost.com/francis-s-collins-md-phd/fair-pay-for-postdocs-why_b_10011066.html

  29. plantains

    Our standard operating hours are 9-5, lunch as you see fit. We often end up eating at our desks, so abuse in taking long lunches is not a problem they are trying to fix. I’m frustrated that when speaking to my supervisor about how switching to hourly would effectively be a paycut (in addition to removing flexibility, which is also a cost in my mind), she countered with “well, in Texas, an 8-hour workday is technically 9-6 with an hour lunch.” This is true, but Texas is no great defender of employee rights, and can’t our nonprofit hold itself to a higher standard? Scripts are very welcome, I am not sure how hard to press this issue. Tracking hours is going to be a big culture change at our institution, and the flexibility of being salaried was sold to me during the hiring process.

    My thoughts are to push for a slightly higher wage but based on a 37.5 hr work week, so I end up with the same home pay and my hours stay relatively the same, with a little buffer for overtime. Does that sound like a convincing argument?

  30. HRChick

    We’ve encountered two problems that we wanted some feedback on:

    1. Because employees who are transitioning are changing from a monthly pay schedule to a bi-weekly pay schedule, they will be paid in 26 pay periods instead of 12. As a result, during the 10 months where hourly non-exempt employees have two pay checks in a single month, these employees’ monthly income will be, on average, $236.82 less than what they earned monthly as salaried employees.

    2. When hourly employees come on board, they are not paid until they have worked a pay period. Hourly employees routinely experience a pay gap upon being hired.

    Currently salaried employees are paid on the 25th of each month for the entire month, assuming they will work through the end of the month. There is no delay in pay; in fact, salaried employees are paid in advance.

    This results in an issue when changing currently salaried employees to hourly employees. No matter when we implement, there will be a time where currently salaried employees will receive only half of their regular monthly income for one month. This is because they are changing from being paid in advance to being paid for a specific time period in the past.

    Our solution to this (so we can try not to ruin Christmas) is to let our employees “cash out” their vacation or offer an advance to cover them for that time period. Do these sound like good ideas?

    1. fposte

      Oh, wow, I hadn’t thought about the gap thing. Dammit, I think that will apply here too.

      I think those are great ideas, especially if you offer people their choice of either. And of course give them as much advance notice as possible so they can prepare.

    2. Sibley

      1. Normally, if you’re paid 12, 24, 26, or 52 times a year, it’ll even out over a year. Because of the switch, if you’re shorting some employees, I’d consider it ethical (if not required, but I’m not a lawyer) to cut an extra pay check to make up the difference for 2016 only. Starting in 2017, you’d be fine. Your employee’s may have to adjust their budgets a little to adjust to the different timing, but that’s not the employer’s problem.

      2. Cashing out PTO to me sounds like a horrible idea. That’s just me though. One company I used to audit had something like this happen, and they just decided to pay everyone extra. Not everyone can or will want to of course. Whatever you do, make sure you give PLENTY of notice to your employees. Like, this month.

      1. HRChick

        I know it will wash out over the year, but people have bills to pay and I think the lower monthly salary for 10/12 months will be a hardship :-/

        I suggested going semi-monthly, but was turned down

        1. Enough

          They aren’t really getting a lower salary they are just getting it in different chunks. And they are not getting half a month’s salary only for the first month. The solution is that they change when/how they pay their bills. Over the years my husband and I have been paid weekly, biweekly, and twice a month. He is now retired and will get paid monthly (pension at the end of the month for that month). Our budget works with all of this.
          Suggest that at some point in a month before December that a check gets issued for work to date (no paying ahead), say the on the third Friday they get paid for month to date (or from the first to the prior Friday) and then 2 weeks later they get their next 2 week pay.

          1. Zillah

            The solution is that they change when/how they pay their bills.

            It seems like the concern is that it’s not necessarily as simply as that. When you don’t have a lot of wiggle room in your budget, it’s often harder than simply rearranging how you pay bills.

      2. HRChick

        I don’t think we’re in a position to be able to afford to just pay extra for an expense we haven’t budgeted for. Wish we could but the amount was too high.

        Can you tell me why it’s a bad idea to let them cash out vacation? Not arguing, just really want to make sure I’ve thought of everything!

    3. Mee Too

      Am I understanding this correctly? You you are shorting them for the year and asking them to give up PTO time accrued to make up the difference. Does this not essentially just short them using PTO rather than pay? I agree that the only ethical thing to do is to make up the pay as a bonus or off cycle payroll to make sure people are not being paid less than their actual salary.

      1. HRChick

        No, they get the same annual pay. We are not shorting them any annual pay.

        They are paid bi-weekly – 26 pay periods. So, instead of dividing their annual pay by 12, you have to divide by 26. They get two “extra” pay periods a year, but during those months without extra pay periods, their income will be lower than they’re used to.

        Say, you’re paid $50k a month. If you’re paid monthly, that’s $4,166.67 a month. If you’re paid bi-weekly, it’s $3,846.15 a month for 10 months. For two months, you receive 3 pay checks which evens out the annual pay. But when you’re not paid those three pay checks, your monthly salary is lower each month.

      2. HRChick

        We are going from paying forward to paying in arrears. We are not taking any money from them at all. They just have a delay in pay until they have worked a pay period. So, on 1 December they become non-exempt. The pay period is, for instance, ends on 10 December and is paid on 21 December. Their next pay date is not until January. That month of December- even though we are not taking any money from them at all – they will only be paid two weeks when they’re used to being paid 4 because they are paid for the whole month.

        When they leave the university, they will have a pay period coming to them after their termination date. As salaried employees, they would not, because they’re paid ahead.

        Does that make sense?

        1. Enough

          In your example you are indicating the pay will be 11 days after the pay period. This is where the real problem is. Assuming that all pay periods now end on a Saturday why is the pay day not the following Friday (6 days later)? This way the employees would get 2 checks in December (the 16th and the 30th). the problem isn’t so much with the number of pay periods as it is with the initial pay date. After the first one everything will be fine.
          My husband went from a job that paid 1 week after the pay period to one that paid 2 weeks after so we had one week where we were “short”. But he didn’t lose any money. That just meant that when he retired we had more money to tide us over to the start of the pension.

          1. HRChick

            I’m sure it is. Those aren’t actual dates, just illustrative. I didn’t have the dates in front of me

      3. Enough

        The problem is psychological. When the check is smaller they think they’re getting less money. Also they need to change how/when they pay their bills.

        1. HRChick

          Yep definitely agree. The lower monthly income could be a problem for some people! Just wondering if anyone had seen this brought up anywhere or any discussion on it

          1. HRChick

            (Sorry button hit to soon)

            … Because the concept seemed to surprise and appall our administration

          2. Enough

            But it’s not really lower monthly income either. It’s just not seeing the same total in the same way. this really isn’t your employer’s problem to fix. They should decide when the switch is happening and immediately explain this so everyone can prepare (financial as well as mentally) for the switch. And detailed example of what you are doing. This will not keep everyone from freaking out but will help a lot.

            1. Zillah

              The issue doesn’t really seem to be whether it’s lower income, though – it’s that they’ll have a two-week period where they’ve likely budgeted to receive a paycheck, but they won’t.

              1. Enough

                But they will have received one before and after. And right now it’s one pay check a month. I much prefer to get a check every 2 weeks rather than instead of just one big one.

            2. HRChick

              I’m not really all that interested in what the company’s responsibility is. I want to make sure that our employees are taken care of or at least that if I can’t, they know I tried

        2. Judy

          It’s psychological, but also can be a cash flow issue if the employee is living paycheck to paycheck.

          When a company I worked for switched from biweekly to monthly for the exempt employees, they timed it so it matched with the annual bonus, so it would cause fewer issues. That is probably not an option for many companies.

          1. HRChick

            Yeah we don’t give annual bonuses, unfortunately! Wish we did! I feel like I deserve one for being assigned all the FLSA stuff lol

        3. Searching

          We had a similar issue last year when we had 27 biweekly pay periods instead of the usual 26. For salaried employees, paychecks each pay period were 3.8% smaller because our annual salaries had to be divided by 27 that year, and of course things didn’t even out until the final paycheck of the year. The prior time this situation happened (late 90s? early 2000s?) it caused a huge uproar. So in 2015, to make up for the pain of the lower paychecks, everyone automatically got a couple more PTO days added to their annual allotment.

          1. Jenny Next

            Your employer is doing it wrong! That is a pay cut, not an accounting adjustment, and people are right to be upset.

            If they’re really concerned about the occasional year in which there are 27 pay periods, they should have calculated the hourly pay as the annual pay divided by 2087.143 (assuming a 40-hour work week). (Alternatively, the biweekly pay would be the annual pay divided by 26.0893.)

            Or, of course, they could just suck up the extra pay period. Or switch to accrual accounting, so that the extra cash hit is just a blip.

            1. Searching

              How is it a pay cut when the total annual salary is the same? These are not hourly employees. Total hours worked in the year did not increase, nor did the number of weeks worked. Total salary paid out in the year did not decrease.

              1. Searching

                I did have a typo in my original comment, it was 3.7%, not 3.8% – in case that was your point.

              2. Jenny Next

                Because the first paycheck is a payment for the work previously done in December.
                27 paychecks, in a biweekly system, is pay for 54 weeks of work. So people are getting 52 weeks of pay for 54 weeks of work. In my book, that’s a pay cut.

                1. Searching

                  I see your point and agree with you when you’re paid on an hourly basis. But when the agreement with the company is for an annual salary, I view it differently – they can divvy up that salary in however many chunks they want as long as the total adds up. But you were certainly not alone in your POV, and the company’s method does get dicier when people start or quit during the course of that year.

                  But they laid me off recently, so I no longer have a vested interest!

    4. Different Name for this One

      We are doing a loan for our employees so that their first biweekly check (which is paid two weeks in arrears, where as monthly checks are paid current on the last day of each month) they have an option to receive a loan equal to 2 X 80 X hourly rate (assuming FT). They will repay the loan over 12 biweekly pay periods via automatic deduction, it is a non-taxable loan. We hashed out a lot of ideas and this was the best.

    5. inkstainedpages

      Why are employees being changed to 26 pay periods instead of 12? Did I miss that part of the law change? Wondering if I need to worry about this at my organization too – we pay both hourly and salaried employees once a month, and were planning to keep doing this.

        1. inkstainedpages

          Ah, thanks for clarifying. I checked, and my state says monthly, semimonthly, or biweekly is fine.

  31. EricT

    I pushed my boss for a raise to get me over the threshold (which I got). After I got the raise the head of personelle at my departmetn said that it does not matter that my new slary is above the threshold because the salary band for my job title starts below the threshold, therefore everyone with my job title will become non-exempt regardless of salary. Is this part of the law or just something my employer is doing.

    1. Ask a Manager Post author

      Just something your employer is doing. They can make everyone non-exempt if they want — the law is fine with that. They just can’t make everyone exempt.

    2. Megs

      I can’t think of anything in the new law that requires this, but I also don’t see anything in the new law that bars it.

      1. hermit crab

        Yeah, my employer is doing something similar. We have a title level where the (currently exempt) staff meet the duties test, but most don’t reach the wage threshold. Instead of making people exempt/non-exempt on a case-by-case basis depending on their salary, all of the staff with that title are being switched to non-exempt.

  32. designbot

    I have a question from the other side of this issue. I’m what could best be referred to as a Team Lead for a small group–I regularly delegate work, answer questions, request staff, and generally manage the day to day tasks for a couple of people, and am responsible for organizing things in a way that we can meet all of our commitments to various clients. There are times when due to an unusual alignment of deadlines or delay in getting the information we need to proceed with something, it is normal for any team in the office to work late or work weekends in order to meet our obligations. I’m generally disinclined to specifically ask for this in the first place, preferring to lay out the situation and what I need accomplished by when and let team members figure out how to accomplish that in the way that seems best to them, and now I’m even more hesitant to ever ask a junior team member to stay late. You see as a team lead but not a manager, I have no clue how much they make. Based on general knowledge of the industry they could land on either side of this, but either way it’s not my place to know their salary information. Would it be appropriate for me to ask our accounting team whether they are exempt or whether I should be aware of anything regarding this new law and how it might impact project budgets? I’m concerned about being seen as meddling in things that don’t concern me since I don’t generally deal with salary information, but what I’d hate to have happen is that my project budgets get blown because someone stays late and has to be paid OT that wasn’t previously an issue.

    1. Megs

      I don’t know if this would work for your situation, but I know that in my line of project work, we are assumed not to be allowed to go into overtime unless expressly told we’ve been authorized. So we all keep track of our own hours, but if we go into OT without authorization, there would be hell to pay (chances are if you did it twice you’d be fired). You should talk to whoever’s in charge of approving time sheets, though, because that seems pretty key to know.

      1. designbot

        To my knowledge, nobody “approves” our timesheets–we submit, it’s automatically tallied, clients are billed. Nobody has ever asked me about a timesheet, even when I’ve put down something I was sure would generate a question or three, and I’ve never had to get a signature or anything.

        1. Megs

          Well, someone must be in charge of hiring/firing/approving budgets, right? If you think there are currently people subject to OT, either no one cares if they go over 40 or not, or else someone’s paying attention to the bottom line somewhere.

          1. designbot

            I don’t think we have anyone currently subject to OT–the current threshold is lower than the starting salary for my industry in all but the poorest of cities. But it seems likely there are people on the bubble, who will become eligible for OT after this takes effect. So it’s something they haven’t had to pay attention to in the past.
            As far as approving budgets, I approve my own project budgets but currently get no feedback on whether I’m on track or not (a topic for another post), and the partners do the hiring. Asking one of the partners about this is exactly what I’m nervous about and looking for a view on whether I should stick my neck out to do or not.

            1. zora.dee

              I think you are going to have to ask, since it seems like this might be a big change for your situation.

              I’m thinking you just ask one of the partners: “In light of the change to the overtime law, is anyone on my projects going to be eligible for overtime starting in December? And if so, are we going to have a system in place for knowing and approving OT hours? I just want to make sure I don’t go overbudget on my projects.”

              does that seem like a problem to ask with your work culture?

              1. zora.dee

                I see what you are saying above about being a lead and not a manager, so you don’t want to be seen as meddling, but in this case I think it counts as your business, because it is going to effect your clients, which is your job.

                In my case, in an industry with billable hours, we all know what everyone else on our team is billed as, because the lead on any given account has to keep track of how much $ we are spending on staff hours for each client. This isn’t seen as a violation of privacy, because it’s really important to the client and by extension the business, that we don’t go overbudget.

                1. designbot

                  yeah we have the billable hours issue, I’ve just slipped through the cracks somehow. The rest of my office has project managers whose job it is to see to all of this, but I’m a sub-specialty that is too small to have any project managers (at this office–at other offices I’ve been at we’ve had our own dedicated PMs). I guess this issue is really highlighting for me that I’m being asked to do the work of a PM without access to all the information that PMs in the rest of the office get. I may actually wind up including this as part of a larger conversation about resources and try to get them to either give me access to this sort of information (bi-weekly project reports, billing rates, staffing plans) or outsource this part of my job to someone who already has access to all that info. Either way I think I’d be satisfied with the result, but being in limbo sucks.

                2. zora.dee

                  Whoa, yeah, that is weird. That is not putting you in a good position at all. I can see the billable rates at my workplace, and I’m just an admin! But because I help my boss process contracts, I have the billable rate sheet. It’s not seen as that big of a deal here to know what my colleagues bill at.

                  But yeah, that doesn’t seem fair to you to be responsible for the project, but not have all of the info you need to do that, and be potentially in the situation of getting in trouble for something that isn’t under your control. I hope you get it sorted out!

            2. Megs

              Hmm, I think I gotcha. Well, if the only people “in charge” are the partners, then I think you should ask one of them about it. It doesn’t have to be a big thing, just a “I heard that there are OT changes coming that could effect some of our people and maybe take a chunk out of my budgets – is there anything you need me to do to keep on top of this?” I totally get being in the “no one’s exactly in charge” position – I think my “boss” might be in Florida somewhere, but I don’t know his or her name!

  33. Jane Fergus

    I’m admitting this question may have been answered before. My husband works for his parents’ business. They have four employees, including my husband, who are all classified exempt but make well below the $47K threshold. Will such a small business be included in the new federal guidelines?

      1. Ultraviolet

        Isn’t there a possible exception if the only employees of the business are the owner and their immediate family?

          1. Ultraviolet

            I’m envisioning a zany movie where the first three family-employees hatch a scheme to get the fourth employee married into the family.

            1. AVP

              I’m excited for the sequel in which a family member desperate for OT enacts a zany plan to get the 4th person divorced from the family!

  34. BeezLouise

    Is this true even if you’re currently given “comp” time for hours worked over 40?

    1. Ask a Manager Post author

      If you’re non-exempt, you can be paid in comp time if you use it in that same work week. You cannot be paid with comp time that’s used in some future pay period; in that case, you’d need to be paid actual money at time and a half. (Unless you work for state government, which often allows it.)

      1. BeezLouise

        Ahh. . . state government employee, unfortunately. It’s my husband’s job, not mine, but he’s just below the salary threshold and works a ridiculous amount of overtime. Shucks.

      2. KatieKate

        Wait… I’m at a large non profit making under the threshold. We can bank our comp time and use it as basically extra vacation time. Will this change?

        1. Elizabeth the Ginger

          From what Alison said above, it sounds like this is already illegal if you’re currently non-exempt. If you’re currently exempt and get made non-exempt, then probably yes, it will change, because it would be illegal for them to “pay” you in future comp time instead of time-and-a-half wages.

          When you’re non-exempt, your employer is required to pay you overtime if you work more than 40 hours in any given week. If you work 42 hours next week, they can’t just pay you for 40 hours and let you take 2 hours off next month. They can, however, let you work 10 hours on Monday, 8 hours Tuesday-Thursday, and 6 hours on Friday without having to pay you time-and-a-half for any of it… unless you live in one of the states that defines overtime as more than 8 hours in a day, in which case they owe you time-and-a-half for two hours on Monday.

          Clear and simple, right? :-)

          1. KatieKate

            Oh boy.

            I’m pretty sure we’re not supposed to bank it…but everyone does it anyway, because usually when we’re working overtime it’s because we can’t work any less than that during those times? So we all save the comp time and use it as extra paid vacation. In the same way that I take a lunch maybe 1-2 times a week but clock my hours as 8-12 1-5 and take smaller internet breaks/walks throughout the day.

            HR has already started getting on our case about the lunch thing (for good reason! I know!) so now I’m curious if they’re going to cut off our camp time accrual… I’d honestly rather have the cash than randomly leave work 4 hours early some weeks.

  35. Unsure

    I have a question related not to the salary but to the “duties” section. I work in a team and we all have the same job, but two people are exempt and two people aren’t. The two people who are exempt have been there longer and make above the threshold for exempt. The two people who are not exempt make less than the threshold. We all do the same work. The difference is that the two exempt people have been promoted due to seniority.

    But the day to day work is exactly the same for everyone. There are no tasks that fall to the two senior people that are more complicated, they aren’t in charge of any special things, etc.

    The duties list is so vague (what is a “learned” individual, anyway?!?) that I don’t know whether or not our work falls into work that should be exempt or shouldn’t be. I don’t think it is particularly high level or complex, and doesn’t take all that special a skill set, but I guess that is open to interpretation. Either way, though, it occurs to me that since we are all doing the same job, at least half of us are miscategorized.

    1. fposte

      It’s always okay to categorize somebody as non-exempt. Exempt is an option for the eligible, not a requirement.

      1. Unsure

        Ah, I guess this makes sense. I personally would not categorize our work as specialized or creative, although it is related to stuff that is specialized and creative. Maybe that is how they get away with it.

    2. STX

      The duties and salary test both have to be passed for an employee to be considered exempt. So there are 4 possibilities (in electronics, this is called an “AND” gate):

      A) An employee fails both the duties and the salary test: Not Exempt
      B) An employee fails the duties test but passes the salary test: Not Exempt
      C) An employee passes the duties test but isn’t paid enough: Not Exempt
      D) An employee passes both tests: Exempt

      It sounds to me like, in your employers estimation, all 4 of you may pass on the “duties” test (ie, are in category C or D), but two of you fail the salary test and two of you don’t. It is possible that your employer is wrong and you are actually in categories A or B, and thus should all be considered non-exempt, but that’s a question for an employment lawyer or for the Department of Labor.

  36. Awkward Interviewee

    Is this something that it would be reasonable to bring up when negotiating salary for a new job? I’m currently looking for a new job for other reasons, and many I apply to are listed as exempt with a salary range in the mid to upper 40s. If I’m offered below $47,476, would it be reasonable to ask for above the threshold and state why? This is complicated by the fact that I work in higher ed, and my duties would probably qualify for the “you just have to make as much as an entry level instructor” exception. But I have no way to know what an entry level instructor makes there. Would it make more sense to just ask if they have a plan to comply with the new rules since the offered salary is below the threshold?

    1. designbot

      I would probably just ask what the overtime situation was when discussing the salary. Most likely they’ll say there isn’t any reason you would be working overtime (with the implication that this wouldn’t impact you), otherwise they would have thought it through and offered slightly over. If you’re actually working overtime, making just below the threshold is to your benefit, no?

      1. Awkward Interviewee

        It’s not necessarily to my benefit to be non-exempt. Due the the nature of job duties and the school calendar, there will be some weeks when I’ll need to work over 40 hours a week, and other weeks when it’s slow and I don’t necessarily need to work 40 to get my work done. I’ll lose flexibility by going non-exempt. In addition, I’d lose benefits, as exempt employees at many universities (including most I’m applying to) get better PTO and retirement benefits. Flexibility and benefits are very important to me. (What my current employer is going to do, since I currently make well below the threshold and can’t see them bumping me or agreeing to pay much overtime, is a whole different can of worms.)

        1. blackcat

          I think they are allowed to calculate “full time, entry level instructional staff” minimum for being exempt using adjunct rates and a “full” course load. Depending on your university, that could be stupidly low (say 10 classes/year @$1,500/class: $15,000). So my guess is that you’d be exempt, unless adjuncts are paid really well at your institution.

          1. Awkward Interviewee

            Ah ok. I thought it was the salary of a full time regular lecturer, not adjunct. (Which I *think* is still just below my salary at my institution.) But when I asked my boss about it recently, he seemed to not know what HR was going to do. Guess I’ll find out in a few months.

    2. Ultraviolet

      I’d definitely lean toward asking whether the jobs will still be exempt under the new rules (and you can ask for a little more info if they answer with just a “yes”). I would advise against opening by asking for > $47k because of that being the threshold–if the threshold doesn’t apply to you, it will just start negotiations off on a weird note, and if it does apply to you, then this salary request amounts to asking to be exempt rather than non-exempt, and it’s probably better to address that question directly rather than indirectly.

  37. OFer (OP 3)

    Thank you so much for your input on our situation. We’ve talked it over at length, in the time since the ruling was announced as well as by phone today after I had a chance to read Alison’s answer and all the comments so far, and she’s more-or-less come up with a plan, which has my full support (it’s always been her decision to make, I was just helping her gather intel). She would prefer it if the company kept her salary the same and limited her to 40 hours per week except during periods of “crunch time” when major projects are nearing completion; it would give us more time together and with our kids. If they choose to give her a raise to keep her exempt, then that’s okay too, since long-ish hours are not that uncommon in her field. If they decide to cut her base pay or benefits in any way, she’s moving on. I’ll send in an update when the dust has settled!

  38. Ughhh

    I’m an academic librarian and this is stressing me out!! The DOL calls out librarians as examples of “higher education professionals” who generally do not meet academic administrator exemption because presumably our duties are not bonafide teaching. If I am a reference and instruction librarian who spends 92% of my time teaching students how to conduct academic research and correctly cite sources as an integral part of their research papers, either individually or in a class setting, do you think those duties are consistent with the academic administrator exemption if I make at least the same as an entry-level instructor?

    I’m pretty sure the university system is going to defer to the DOL guidelines’ interpretation of librarian duties and we’re going to lose our exempt status and be expected to get our work done w/o accruing over time (which is impossible). I just want to know if I have grounds to be annoyed about it, impotently! Like, it makes my job harder to have to worry about clocking in from home to check an email from students, not easier. I work on stuff from home all the time in preparation for classes (because I’m an f**king teacher!!) I would 1000% rather be exempt at my current salary than be non-exempt.

    1. Ughhh

      I pronounced that “an effing teaching” in my head, which is why I ended up with “an” and not “a.” Whoops.

    2. Awkward Interviewee

      Yeah, it’s definitely frustrating that no one outside of education understands that for many roles that work with students but aren’t official instructors, being exempt just makes so much more sense.

    3. Ultraviolet

      So I’m seeing this from the DOL:

      In higher education, examples of non-teacher learned professionals that generally may meet the duties requirements for professional exemption include certified public accountants, certified athletic trainers, librarians, and psychologists, depending on the employee’s specific job duties and education.

      That is, this document suggests librarians meet the duties requirement for exemption (though not, as you say, in the same way an administrator would.) However, since you are not a “bona fide” teacher, you would also need to meet the salary requirement in order to be exempt. I’m not an expert, but it sounds like this applies to you? Link to follow in a reply to this comment.

        1. Ughhh

          Yes, I understand all that, thanks for the recap. I’m arguing that I should not be lumped with athletic trainers and psychologists, who are learned professionals who work in higher ed but do not provide instructional services to students in any way. I understand that I would meet the duties test even if I didn’t work in higher ed. if I met the salary threshold, because I have a Master’s degree. I’m a learned professional any way you look at it. That’s fine. I’m arguing I should fall under the salary threshold exemption that “academic administrators” do: “Additionally, academic administrative
          personnel that help run higher education institutions
          and interact with students outside the classroom,
          such as department heads, academic counselors
          and advisors, intervention specialists, and others
          with similar responsibilities, are subject to a special
          alternative salary level that does not apply to white
          collar employees outside of higher education. These
          academic administrative personnel are exempt from the
          FLSA’s minimum wage and overtime requirements if
          they are paid at least the entrance salary for teachers at
          their institution. ”

          It’s literally offensive to me that it’s not acknowledged that my work is more like that of professors, academic advisors, counselors, etc. than it is to positions like psychologists who work in college health centers or athletic trainers. I’m classified as faculty. My entire job is teaching students how to do something fundamental to their education. Like, athletic coaches can be considered bona fide teachers under the DOL guidance, but not librarians. It’s a fundamental misunderstanding about what many librarians do. I’m not a file clerk. I don’t sit behind a desk all day cataloging books. I’m a teacher. I work with students, all day every day. I teach students in classrooms.

    4. Dear Liza dear liza

      Right there with you. Even worse: about half our department is over the salary threshold, and half below. Everyone has the same job description. How the heck are we supposed to handle this? Tell the people making $48k they have to do extra classes so those making $47k don’t go over 40 hours?

        1. Dear Liza dear liza

          What makes sense /=/ what will be done. I’m at a state university with serious budget issues. Raises almost never happen, and on my campus, the head librarian has zero control over salary adjustments.

  39. Any mouse

    I work for a huge nonprofit, pass the duties test, but not the salary test. We already track our time because we are contractors for the federal government. We work 8.5 hour days (sometimes a lot more, and sometimes weekends) that include a half hour for lunch, but most people work during lunch. We’ve always been told to put 8 hours in our timesheet every day, regardless of how much we actually worked. Can we keep this up or will the rules get more strict?

    1. Ask a Manager Post author

      Once you’re non-exempt, they’ll have to pay you for lunch if you work through it — and they can’t tell you to log fewer hours than you really worked (at least not for pay purposes; they could tell you that for contract purposes, which is different).

  40. ConfusedCamper

    Are there any exemptions for the type of work? We’re a non-profit with a two-week camp-like session during the summer. Salaried staff there make less than the threshold but work exceptionally long days for that short period, and are away from home at the camp. We normally give everyone an entire paid week off afterwards, but obviously we’re doing to have to change how we approach this.

    How should we handle that according to this new law?

    1. Natalie

      Yep, there’s a carve out for summer camps, amusement parks, and other seasonal things. Link to follow.

        1. ConfusedCamper

          Thanks for that – but it looks like it doesn’t apply to us (or to many similar orgs) because we are in operation (as a non-profit doing regular programming and conducting business) year-round, we just only have the camp during the summer.

      1. Elysian

        This carve-out doesn’t apply if the operation itself isn’t seasonal – a non-profit that operates year round and also runs a summer camp isn’t a seasonal establishment. A non-profit that only operates part of the year for running a summer camp might qualify. This exemption doesn’t let you carve out only part of your business as “seasonal” — it has to be the whole operation.

  41. Bryan

    I work for a religious organization, and recently brought up the issue of exempt vs. non-exempt. My manager and a member of the board were both prepared to begin the transition for several of us from “salaried” to “hourly” to abide by the new regulations. At a recent board meeting, another member of the board who is a CPA helped them decide that we could continue to be treated as exempt based on their reading of the FLSA.

    Everything I’ve read online from other nonprofits in my industry (some of which cites case law) reinforces the idea that we should NOT be exempt from overtime simply because of the nonprofit nature of our work. I had a brief meeting with my manager, and was left with the distinct impression that it was up to me to convince people of my reading of the situation. I don’t know how to do that without consulting a lawyer, and I’m very concerned that will be viewed unfavorably.

    Any advice from someone who would know what to do in this situation would be greatly appreciated! Or just well wishes for those of us involved, that we make the transition without things getting ugly. Thanks for reading.

      1. Bryan

        Thanks for asking! Their reasoning is primarily because we are not a business. If I’m understanding the regs correctly, this means we are not included in “enterprise coverage”. I asked them about “individual coverage” as most of my web searching for my industry has uncategorically stated that almost all employees would be covered in this way… they said we don’t do any interstate commerce. This gets into a gray area that I’m not nearly qualified to argue, but all my amateur reading says that interstate commerce is so broad that we’re probably covered. The board leadership has definitely let this become my issue, though…

        1. HR

          Interstate commerce can be achieved by anyone who orders supplies or makes a phone call out of state. Your searching is accurate…if a non profit does not meet as an enterprise ($500,000 in revenue), often an individual will meet requirements because of the nature of his work.

          You can Google DOL and Non-profits to find FAQs and Guides for Non profits. The narratives in the literature explain the types of work that contribute to commerce and when an individual is covered.

  42. Audiophile

    I’m so glad you posted this. The job I just started a few weeks ago with a nonprofit organization, has me exempt with a salary of 30k. I’m not sure of their operating costs, but I believe my role would be considered non-exempt under the new regulations. With all the turmoil over the last few weeks, I’m hesitant to bring this up. I wouldn’t put it past them to “fire” me, since I’d really be the only one who is affected by the new regulations.

    Since they’re pay weeks are capped at 35, I wonder if it’s even worth bringing up at all.

    1. RedinSC

      This sounds like a case for salaried, non-exempt.

      I’m really glad I learned about this today. I think it will help us with the handful of people who fall into this. Their work can remain salaried, but they get paid over time for any work over 40 hours (and since I’m in CA any work over 8 hours in the day, actually.)

    2. Ask a Manager Post author

      So, currently the set-up is legal — but it won’t be as of December 1. Since you’re new and since you have some time, I’d wait a few months and then ask if it will impact anything for you. (It sounds like since you don’t work over 40 hours any weeks, it won’t have any practical impact so I wouldn’t worry about it being a big deal.)

  43. Totes anons

    I wish this weren’t a moot issue for me and also a lot of other people. As I posted a couple weeks ago in the open thread, people in my department have a daily quota of tasks. If we don’t finish them by close of business, we’re required to clock out and keep working until we’re done. I’m slower than most people, I know; today I stayed 2 1/2 hours extra (I slept poorly and was out of it). I know they’re not supposed to do this, but I’d probably lose my job and almost certainly wouldn’t be hired with benefits if I complained; they’d know it was me because I asked them to clarify the policy. I have no other prospects and a poor work history, but the job duties are fine and the people are nice. It’s low 30s in an expensive metro area, but I’ve had much worse, and worse-paid, jobs.

    As far as I know, my only decent choice is to keep my mouth shut, suck it up, and try to get faster while staying as accurate as possible.

    I guess this is to say that our current system depends on employees taking the risk of painting targets on their backs by reporting. As a result, labor laws are more honored in the breach than the observance. If there were random audits instead, maybe laws like this would be worth more.

    Yeah, I’m bitter.

    1. Bryan

      I absolutely agree! I had a job like that. On the one hand, I felt like I should report and get fired, or quit, to make a stand (if we all stand up for our rights, they have to honor them, yeah?) But it’s hard to do that when you need the paycheck!

  44. mechanic's wife

    I was wondering how this affects flat rate employees. My husband is a mechanic and gets paid depending on the jobs he does, which means a varying income and hours worked. If he makes less than the minimum, does this law have any bearing on him?

    Flat rate technicians are paid per tenth of an hour based on the job. For an example, if their hourly rate is $10 an hour, and an oil change pays 4/10, they make $4 for that oil change, regardless of how long it takes them. If they have to rebuild an engine and the book says it pays 80 hours, they get paid $800, regardless of how long it takes them. Some will get it done in 20 others will get it done in 150, but if they have the same rate of pay, they get paid the same amount. In my husband’s case, he’s typically at work 50-60 hours a week, but his paycheck could show he’s being paid from 20 hours or 120+, depending on the work he had that week.

  45. Basiorana

    I make $42k and put in an average of 50-60 hours a week, so raising my salary would be cheaper. However, a lot of that time is travel – I fly all over the place for work. I consider it working if I am driving, at the airport for less than 2 hours, or in flight for work, but would they need to pay me for this time, especially if it’s outside of normal working hours? I have no idea how they normally do travel for non exempt employees.

    1. Ask a Manager Post author

      If you’re non-exempt, if you’re doing the actual traveling during your normal work hours, you have to be paid for that time. If the travel happens outside your regular work hours, they don’t have to pay for you it (like if you have an evening flight that’s outside of the times you normally work).

      1. Basiorana

        What is considered regular work hours? Technically my job is business hours but I answer emails all weekend, and when I travel I generally work late. I’m also regularly expected to work weekend trade shows.

      2. Ghost Town

        I really dislike the fact that non-exempt employees do not have to be paid for travel is it occurs outside the regular business schedule. If I’m flying back on Saturday after a Friday event or Sunday after a Saturday event, I’m only traveling b/c of work. I wouldn’t be spending this extra time on an airplane, in an airport, or whatever if work didn’t want me someplace else for an event. So, employee loses a day w/no compensation, unless I’m not understanding something.

  46. Confused

    Scenario: exempt employee is given 20 days off per year (this includes holidays) and is required to work 45 hours per week – getting paid the same salary for each pay period. Exempt employee is on call 24/7. For every day the exempt employee goes over those 20 days, the employer deducts 1 day’s pay from exempt employee’s check starting in January of the following year. Is this legal?

      1. Confused

        This happened in 2016 and 2015. Can we somehow get that money back? I know the employer will want backup for this not being legal.

        1. Confused

          Also, how should days off be handled for an exempt employee? If you go beyond the 20 days “allowed,” what happens? I assume you can’t just take off all the time just because you’re on salary. Are there guidelines for this?

          1. fposte

            The general recourse is job discipline–you go into the red on vacation, you’re warned and you might be fired. They can’t unpay you for time you already worked.

  47. Tara

    Has anyone else heard of how academic institutions are planning on handling researchers? The discussion at the research institute where I work is particularly about Research Associates, Post-Docs, and Professional Research Assistants (PRAs). These are people who are not students and who don’t teach, they just do research.

    B/c my institute is entirely grant-funded (we don’t get any financial support from the university where we are housed), all of our researchers’ salaries are set by federal NIH or NSF grants. Since these researchers’ salaries were set by the grants, we don’t actually have much control over how much they get paid. If your grant doesn’t have money to pay researchers, then they don’t get paid. However, NIH/NSF have not given any info that they will be raising salaries for grant personnel, federal grant money can not pay for over-time, and academic culture/the realities of research mean almost everyone works work than 40 hours a week.

    I get that the law is trying to tackle things like people not being paid appropriately when they work over 40 hours, but this new federal regulation has not forced federal granting authorities to raise grant salaries, so it puts researchers in a bind.

    The Higher-Ed DOL guidance also says that Post-Docs are paid around the salary threshold anyway, but that’s not true here, esp. not for PRAs. Post-Docs and Research Associates have to have doctorates, but PRAs just need a BA or MA.

    1. Tara

      Ah, missed some of the above discussion. Still, most academic departments have some hard money to cover salaries and aren’t totally grant dependent like us, so I’m curious how grant funding may/will change?

  48. Close But Not Quite

    I am currently exempt and earning 45,000 – close to the new threshold but not quite there. I do however receive a great benefits package – so my question is if they use only your gross salary to determine if you meet the threshold, or if they add the value of any benefits you receive as well? I feel like if it’s the latter, then that probably pushes me over, but I don’t know how to calculate what my benefits are worth.

    1. ILurkALot

      Nope, benefits don’t matter unless it’s a bonus as described by OFer (OP 3) in reply to Dr. Ruthless’ question about a $45,000 salaried employee above.

  49. Kylie

    I have a question about promotions during this transition with the new law when organizations are still deciding how they will respond.
    At my organization people being hired into a project management position from outside are regularly offered $46 to $58. I was just promoted into this same project management position internally and my salary was bumped to the new overtime threshold. I know normally internal employees in promotions (at least at my org) will always be making less that people hired in directly at that level due to our strict promotion guidelines. Even though I know that I have extensive skill and experience that would be conducive to a higher salary, I felt stuck based the internal polices and had accepted that I would be getting less than others with the same or less experience/skill.
    How our organization is planning to respond to the law so far, is to raise salaries levels of those that work overtime to the new threshold. This would include my direct reports and people one level below them as we all work a significant amount of overtime. When this happens I will have the same salary as my direct reports, and their direct reports. . . I haven’t heard if there would be additional bumps in salary up the chain and I don’t know if it is appropriate to ask about. It makes me wish I had attempted to ask for more during my promotion, because it is making me feel undervalued. Managers in my org have no say in salary or raises in terms of amounts, it is all handled by HR and Managers frequently don’t know what their employees are paid. Do you think I should ask about additional raises after the new law goes into effect?

  50. Agency Guy

    I manage a marketing firm. Billable work is the norm in our industry. Does this new law pertain to the time that people are at work or just the time they bill? We have time tracking in place but no one actually bills 8 hours per day (some people aren’t at work for 8 hours per day either).

  51. Antonio tadeo

    So I’m a landscaper and my company pays me 700$ weekly but I work no less then 55 hours a week, do i qualify for the new over time law?

  52. HappyButAwkward

    I was thrilled to hear my salary will be increased by about 15% to meet this threshold. The tricky part is that my close group of coworkers have been at my workplace for years worked hard to increase their salaries. I have one coworker who has been here 5 years (a lifetime at my nonprofit) and over that time their salary increased from about 30k to 48k. They are one of the hardest working and effective people I know, and come Dec. 1 I will be making almost the same amount after only a year and a half. I know it isn’t my issue to deal with and I am happy to be making more money, but this situation doesn’t sit right with me.

    We discussed pay recently and my super-star co-worker will still be making under 50k as a manager (and I’m an associate). I acknowledged this made me feel uncomfortable and shocked, and the group agreed it didn’t seem fair. I wish we were flush with cash to give at least a token bonus to people who had earned their way up to that salary before this law came into play, but we could never afford it (also not sure if that’s actually a good idea). I guess I’m feeling guilty, like I didn’t really earn the raise (though I think I deserve it and my work warrants it).

    Is anyone else navigating a similar issue? Is there anything I can do to help my coworker negotiate for higher pay? Should I just be content with my huge raise? Was it a mistake to discuss salary in the first place? Are organizations doing anything about this type of situation?

  53. Cat

    This new law will affect me as I am currently exempt. I currently make less then the new salary requirement but do manage more then the 2 employee requirement.

    In my position, I (along with 3 other supervisors) work the same shift as my employees on a compressed work schedule. We are a management company that manages the contingent workforce at our site. Our employees work 12 hour shifts but are paid 11.5 with 2 – 1 hour breaks during their shift. As it stands they are paid for 34.5 hour for a 36 hour(3-day) work weekand 46 hours for a 48 hour(4-day) work week.

    As a salaried manager I am paid the same regardless of hours(which typically well exceed the work week) and don’t receive the same amount of break time due to my workload. Our employees are paid OT on any hours over 34.5 on their short weeks and over 40 on there long weeks(so they will always receive a minimum 6 hours on their long weeks).

    Considering my employees schedule, would it be advisable to pay me the same way and follow the same schedule? I understand they could just lower our hourly wage, which would show us making much less the some of our current employees that we manage. Or would it potentially be in thier best interest to raise our salaries to the new minimum? And since we don’t clock in, we may be put on the honor system(but there is the option we could clock in like our employees) which could go both ways.

    Thanks.

  54. IamtheWalrus

    Hi,
    I just stepped out of my managers office regarding this very topic. Mind you I had no idea about this law before stepping into his office and I’m currently still trying to wrap my head around it. I make roughly $41,000 a year on salary and work 40hrs a week. I never put in any overtime.
    He asked me if I had a problem with being put back on hourly. #1 my base pay would stay the same. He basically told me that under this new law, my current salary wouldn’t meet the threshold for whatever new rules that are about to pass.
    Now I told him I don’t think I would mind, (anything to help the company is my mind set) I would just need to adjust back into punching in and out everyday. I did tell him I would like to wait till December 1st for this to take effect.
    I know I should have asked more questions, but I really had no idea what this new law was and kind of had a feeling he didn’t either. He was merely just passing on news he received from the HR.
    So my question.
    1. Are they in the right to ask me if I want to be put back into hourly pay?
    2. Can they force me to be put back on hourly pay?
    3. Are there any benefits for me under this new law given I don’t work over 40hrs a week at any given time?
    4. What options do I have now?

    Thanks

    1. Ask a Manager Post author

      They can indeed pay you hourly. But they could also make you salaried non-exempt, meaning they keep you salaried and just pay you overtime for any hours you work over 40 in a week. That’s what I’d ask for.

      1. IamtheWalrus

        Thank you for your advise. I just spoke with HR here at work. He expressed that there are only 4 employees that will be effected by this new law and I’m one of them. Because of this, they don’t want to setup a system to track these salaried non-exempt employees for just 4 people and they certainly are not going to give us a raise to meet the new salary threshold.
        So….it looks like I don’t have an option, but to be put back to hourly. The upside is that I’ll be able to get paid for whatever overtime I work.

        1. Ask a Manager Post author

          Their answer is weird because if you’re hourly, that’s definitely going to need to be tracked. Making you salaried non-exempt wouldn’t involve any more tracking than hourly will.

          1. IamtheWalrus

            Yeah I know what you mean and that was my argument, but I think they just really don’t want to bourdon themselves in the chance that a salary non-exempt worker does work overtime. Not for just 4 people. They already have a system in place to track hourly workers and a good 85% of the people who work here are hourly.

  55. Nighthawke8

    I just started a job on the week of August 18, 2016. They are starting me@ 46,000 and I am an exempt employee. The company offers potential bonuses every quarter – but they are not guaranteed. In fact, the rules to hit the bouns mark are very steep and the office has not made the goals in the last three quarters. The bouns is quarterly and equates to $550 potentially every three months. When I started, I must work 90 days to be eligible for said bouns. However, I only qualify past 90 days. So in this instance, I would qualify for October – December – however my qualification date to start will hit November 15th. So I will be eligible for more or less 35 days of ‘bouns’ – which is like $100 if I can even hit the goals.

    The company is trying to tell me that because of the bouns (which is NOT guaranteed) that I am making over $47872 – therefore an exempt employee for the new laws. My paperwork clearly stated my salary is $46,000 ‘with potential bouns if goals are met.’ I have always been taught that paperwork is the deciding factor – therefore I make $46,000 with ‘potential’ and I’m an exempt employee. Therefore that makes me eligible for overtime with the new laws starting December 1st.

    Can someone please advise here. On one hand – it’s a new company and I don’t want to rock a boat. On the other hand – I want to make sure I did not just walk into a shady company that is going to try to cheat the system.

    1. Ask a Manager Post author

      Yeah, they’re wrong.

      Up to 10% of the salary level used to make the salary calculation can come from non-discretionary bonuses, incentive payment, and commissions, but a non-guaranteed bonus wouldn’t qualify.

  56. LiteralGirl

    Hi Alison, I know this has been up for a while, but my friend just got the following from our HR department after she asked about it:
    “While as a 0.80 FTE exempt employee, your salary is under the salary threshold per the new FLSA guidelines, your annualized salary (if you were at a 1.0 FTE) is above the threshold at $58,453.23. This FLSA change is based upon an annualized salary, so nothing will change for you. ”
    We do get bonuses, but they are not guaranteed. Does our HR department have it wrong?
    Thanks for answering!

      1. LiteralGirl

        That’s so strange! This is a large organization (8,000+), so I wonder if the HR rep just gave her wrong information.
        Thanks for your input.

      2. IamtheWalrus

        Hi,
        any comments about my post above? I’d like to get back to my manager as soon as possible.

        Thanks!

  57. Stephen

    Sorry i need to give more info. I am the general manager, i do the hiring, firing, scheduling and over see the entire building.

  58. MissLiss

    I have a question……
    We get paid biweekly at my job. The pay period goes from Saturday to Saturday. My coworker who works Tuesday through Saturday asked me if I could cover a Saturday for her and in return she would cover a Monday for me as I work Monday through Friday. When it came time to hand in our time cards (Friday) I realized that even though she worked for me the Monday prior, the Saturday that I was covering for her was going to fall on the following pay period and not the current one. It stunk because that meant I was losing six hours out of the paycheck I was going to receive in the next few days but was OK with it considering it would be on the following paycheck.
    I then realized when filling out the next time card that I had six hours of overtime on it and it was from the Saturday I covered for my coworker. I got a bit excited (who wouldn’t?) at the fact that I was going to have six additional hours at time and a half in my next paycheck yet when my practice manager saw it she said that I will not be receiving time and a half but only regular time due to the fact that I was “covering” for my coworker and didn’t work for one of my normal days the week before. I explained that the reason why I didn’t work one of my normal days the week before was because my coworker worked my day for me since I was covering her Saturday and my practice manager told me that it doesn’t matter, I was only getting paid regular time for those six hours. Now I’m not normally one to complain as long as I get paid but I’m curious to find out, am I entitled to that overtime pay? I mean if we’re playing by the rules here, our pay period goes from Saturday to Saturday and I worked on that Saturday so wouldn’t it be considered time and a half?

    1. BobcatBrah

      Yeah, you should be getting overtime for that shift. The normal time thing won’t fly.

      I wouldn’t make it a habit of switching shifts that knock you into overtime without management approval, though.

  59. Kay

    I was making $35,895.50 salary per year and was required to work 50 hours per week as a store manager. In order to comply my employer converted me to an hourly employee and am now making $13.81 per hour. I am no longer going to get ANY OT so my yearly pay is reduced by almost $7K per year. Can my employer do this?

    1. NarrowDoorways

      That can reduce your pay in an attempt to match the year end, BUT if you’re hourly, you should be getting overtime for any hours a week over 40.

      1. Kay

        Not sure what you mean by reduce your pay to match the year end. My yearly salary was $35K, at my new hourly rate of $13.81, my year end pay is going to be reduced by over $7K. My employer is stopping all OT.

        1. Elizabeth

          Unfortunately, employers can cut pay so long as it doesn’t go below the minimum wage for your area. Your employer will still have to pay OT for anything over 40, but nothing prevent them from changing schedules, hiring more staff, etc. to avoid people going into overtime to begin with.

  60. Leslie

    I work as an ICU nurse and 12 hour shifts. If my facility puts me on call and then calls me to work but I won’t get a full twelve hour shift we get 12/8 pay-meaning less than twelve but more than eight hours which then is time and a half for hours over 8. I’ve been told that if we need to work reduce and send a nurse home our employer will ask for “volunteers”, to go home and if you volunteer you then lose 8/12 pay. We have a numbered rotation for work reduction of staff which is trumped if there is a volunteer –is this legal?

  61. NarrowDoorways

    So the office manager told me that no changes will be made to my pay once the salary laws change. Right now I’m exempt and working 45-60 hours a week.

    I’m trying to navigate how I’ll handle my new schedule–on my own, as the CEO seems to think the new law doesn’t apply to our company. I plan pick and show up at a regular time, leave the building for my half hour lunch instead of working through it, and go home for the day after exactly 8 hours. This will bring me down to what my original job offer stated of 37.5 hours a week.

    And then, when I have meeting with the CEO, just gently explain my shortened schedule as a reason why I am no longer making many of my deadlines.

    This makes sense, right? The CEO is refusing to read any of the articles on this new law (taken by me from Alison’s posts and sent to HR, who is trying to tell her she should be addressing it). The CEO feels that because we’re a small company–25 employees–we don’t count under this new salary law due to our size. Not true though. We’re not a non-profit, though I think that exception if for way fewer employees. Also, the company I work for was purchased by a very large corporation at the beginning of 2016…

    1. NarrowDoorways

      I JUST found out that I’m going to be receiving a raise in the next week or two, but unrelated to the new salary law! Because it’ll be the normal type of cost-of-living raise. When I sit down with the CEO to discuss it, should I mention the salary law then??

  62. OFer (OP 3)

    My wife’s situation may soon be moot, as some crazy stuff went down over the weekend. If anything comes of it, I’ll send an update.

  63. Nonprofit Nancy

    I have to say, I know it’s childish – and I’m so happy for everyone else whose situation might be improved! – but I wish this law had come at a better time for me personally. I was formerly the kind of worker this might have helped – starting at 30K and working my butt of, nights and weekends. I clawed my way up over a number of years and am now over the minimum. Now the colleague in the job I was just promoted out of is getting these advantages – paid overtime! Comp time ! – and his extra work is … all falling to me. Since I’m exempt, I get bubkis for this extra work, although I’m glad for him. I guess …

  64. Bill

    I am a two sport coach. I make a salary but it is combined between two jobs at the University I currently work for. Between practices, travel and games I work well over 40 hours per week. I’ve asked for a raise 3 years in a row and received a small 2-3% raise, the University standard. I asked my Director today and he had no idea about the law. Then said that coaches fall under the same category as teachers and this doesn’t affect me. How do I know if I qualify? Who can I ask if I qualify, is there a non profit company or someone explaining this law to citizens? I’d rather not bring a lawyer into this but since it’d be about a 13,000$ raise I would if I had to. What paperwork would be needed?

  65. Annemaria Duran

    I keep trying to take part in this conversation but my comments aren’t posting. Is there a reason why?

  66. Alison LaRoussa

    My daughter is being offered a position with a salary of $20,000 with a guarantee of $3000 overtime and supposed commission base of $4000-$5000.
    She will have weeks where she will be working 7 days and over 60 hours.
    I understand that the

  67. Vet question

    Does the new law pertain to medical or veterinary interns, where there is a significant educational component to their employ?

  68. Tom

    I have heard that a company can get fined if they don’t make the change with the new law if that’s the case with my company can I sue them for not paying me the overtime.

    1. nonpartisan

      I’m holding out hope that it is delayed by either the injunction, bills, or lawsuits. I don’t care which, only that it is. The OT rule is doing far more harm than good. I’ve yet to speak to anyone affected who will actually benefit. The opposite is happening.

  69. saul Barrera

    I work for Burger King Normar Franchise. They started Salary as Of August 1 2016. I make 33,000 salary. They lower my pay to 11.60 hour. Caculated 50 hours per week from my salary. I thought it was suppose to be 40 hours. I work every holiday and every Sunday. Is there any double time or holiday pay. With this new law effect Dec.1. 2016. Also they pay us 88 hours then overtime after that. They say because pay structure every 2 weeks. Can someone help me with some question to answers. Please and thank you.

    1. nonpartisan

      That’s the unfortunate reality of the new OT rule. It’s legal for employers to calculate new hourly rate that way. Employees aren’t paid any more, even with overtime pay, and don’t work less hours either. Most employees won’t get any benefit from the new OT rule. If/when we don’t work the full calculated hours, employers can now pay us less because we’re hourly instead of salaried. Full time is 40 hours per week and anything after that is OT pay but we get a 30 min unpaid lunch if we work for 6 hours or more. Lunch time is subtracted from hours worked first and then OT pay is calculated. There’s double time for holidays but it has nothing to do with the new OT rule. It’s only for 6 holidays – Thanksgiving Day, Christmas Day, New Years Day, Memorial Day, Fourth of July, and Labor Day. Getting paid every 2 weeks is also legal.

  70. Sandra

    I am currently exempt (salary) and making less than $47,476; are there any exceptions to the rule? My job doesn’t require overtime.

  71. LolaRose

    I’m a grant writer for a nonprofit and easily work more than 40 hours a week but only make $33,000 a year (salaried). I tried to speak to HR about the issue but they told me there would be no increases to my salary nor would I be switched to hourly as I am not included in the new ruling as I don’t supervise someone. I’m confused by this, can someone explain this in laymen’s terms and whether or not this is legal.

        1. Ask a Manager Post author

          You don’t make enough to be treated as exempt, which means they’re legally required to pay you overtime. Salaried or not salaried is irrelevant; exempt or non-exempt is what matters. That’s what this whole post is saying!

          As of Dec. 1, if you make less than $47,476, you must be paid overtime.

  72. DENISE

    IF YOU ARE A RESTAURANT MANAGER AND ALSO MAKE TIPS SERVING TABLES DO THOSE TIPS COUNT AS PART OF THE SALARY THRESHOLD OF 47,476.

  73. Billy J Howard

    What about salaried workers for fast food chains that work 45 hours or more a week making just 455 weekly

  74. Jill

    I work for a company that is very lenient with the salary workers and when they work. We are expected to work 40 hours a week but it is not tracked at all. We don’t have sick days or time allotted fro doctors appointments, we are just allowed to take the off if needed and as long as we don’t abuse it. A coworker of mine is worried that we will now have to make that time up, is that correct? I did read on an earlier question that they could pay us a set pay but have to pay us overtime IF we go over. Would this be the same thing? All of us in the office definitely make less than the $47, 476 exempt threshold.

  75. (Mr.) Cajun2core

    How much is the minimum amount worked have to be before you get paid for it? For example, if I am at home, and my boss calls me and asks, “Where is this file?” and I reply, “On the shared drive in the FORMS folder.” That whole conversation took less than 1 minute. Do they have to pay me for that one minute? I would doubt it since I doubt anyone’s payroll system is set up like that.

    I know in the “old days” of punch clocks and even on our current time system, the minimum is 7 minutes. For example, if I clock in at 7:53 it is the same as if I clocked in at 8:00. However, if I clock in at 7:52 it is the same as if I clock in at 7:45.

    Is there a legal minimum amount of time worked that your employer has to pay you for?

    Thanks!

  76. Amy

    Currently, my organization requires all employees to track and submit their hours for each pay period, regardless of their exemption status. The majority of the staff are exempt, but several will fall under the new overtime threshold. We’ve recently received a directive to no longer record any overtime hours unless they have been approved in advance by finance.

    For those of us who are exempt and salaries are above the overtime threshold, and therefore would not be entitled to overtime pay anyway, can the organization to ask us to not accurately record the total number of hours worked? Second, if an employee that is under the threshold works overtime without prior approval, can the organization deny them overtime pay or require them to not record those hours? This just feels highly unethical to me and maybe even illegal.

    1. Ask a Manager Post author

      If you’re exempt, it’s legal for them to tell you to only record 40 hours.

      If you’re non-exempt, they absolutely cannot do that, and they cannot deny pay for overtime even if it was worked without approval. (They can discipline/fire people for working unapproved overtime, but it must be paid out.)

  77. Adriana

    My office recently went through and changed everyone’s job titles. My title was originally “Manager” but is now “Coordinator.” I was told that this was done because under the new federal overtime regulations non-exempt employees are no longer allowed to have the title “Manager.” I was hired as a salaried, exempt employee but my wages are below the salary threshold for the new law so I will be considered non-exempt moving forward.

    I have looked extensively online but have not seen anything that connects job title to federal exempt/non-exempt classification. We are a small nonprofit with 9 employees and no trained HR professional on staff. I honestly think they are incorrect in their conclusion that they needed to alter titles because of the new regulations. What do you think?

  78. Liketoknow

    I have been an Assistant Manager for 5 years. The other Assistant Manager for just a year. Our salaries are both below the threshold but with a $5000 a yr gap between the two. I was told we are both being raised to the threshold. My question is shouldn’t the difference in salary based on tenure remain at least close to what it is?

  79. CanIAppeal

    I make around $53,000 per/year, have a bachelor’s degree and am being forced to go to non-exempt hourly on Dec. 1 because of my job description. Can I appeal this to my HR department somehow given the fact that I earn above the threshold?

    1. Ask a Manager Post author

      You have to meet both the duties and the salary test. It sounds like you meet the salary test but not the duties test, in which case they’re legally required to make you non-exempt (but they could keep you salaried, not hourly, if they wanted). But if your job description hasn’t changed, that also means that you should have been non-exempt this whole time. If that’s the case, they may owe you back pay for any overtime you worked previously. It would be worth finding out if that’s the case!

      1. CanIAppeal

        Thank you! Who has the final say in making me “salaried non-exempt” or “hourly non-exempt”? Could my boss and the head of our department make the request to HR that I remain “salaried-non-exempt”? I never go over 40 hours; however, there are weeks where I work 35 hours and make up those hours the following week by working 45 hours. I think it would be to their benefit if I were a “salaried non-exempt” employee. Thanks again this has been very helpful!

        1. Ask a Manager Post author

          It’s up to your company, but whether it’s HR or your manager will depend on internal policy.

          But if you’re non-exempt you can’t make up hours from one week to the next; you’d need to be paid overtime for the weeks where you worked over 40, even if they’re “make-up hours.” That’s true whether you’re non-exempt salaried or non-exempt hourly. (It’s the non-exempt part that matters, not the salaried/hourly part.)

        2. (Mr.) Cajun2core

          One very important thing to note is that if you work for the government (I assume this means state governments also) you *can* accumulate comp-time. For example, I work for a public university and we are allowed to accumulate comp-time.

  80. Adriana

    I was hired as an exempt, salaried ($37,000/year) employee with the job title “Training Manager.” I was recently informed that my job title is now “Training Coordinator” and that I will now be non-exempt because my salary does not meet the threshold. My Executive Director stated that non-exempt employees are no longer allowed to have the word “Manager” in their job titles. I don’t mind being non-exempt but I am a little upset about the change in job title. They “updated” my job description so that it accurately reflects the work I have been doing which is higher level than what I was hired for but none of my actual job duties are changing.

    I have looked extensively online but have not seen anything that connects job title to federal exempt/non-exempt classification – my understanding is that it’s based on job description and salary. Are they correct in their conclusion that the new law requires them to change our job titles?

    1. Ask a Manager Post author

      No, they definitely aren’t required to do that. (And it makes no sense — the government is fine with treating everyone as non-exempt if an employer wants to. It’s only in treating people improperly as exempt that they could get in trouble.)

  81. Jaclyn

    I am currently a salary employee making 40,000 a year. I am an event coordinator along with other duties within my company. I work at my desk through out ‘bankers hours’ but then set-up and work events at night and on weekends (overtime) would i qualify for overtime pay or would i be exempt ?
    Thank you!

  82. Traci Benson

    If I am a Salary employee who is making approxiamelty 54,00.00 a year but I am on call 24/7. My current status is Manager. If they bring the Supervisor under me up to 47,000+ but we both take call everyday of the week and spend countless hours on our days off and after we get off work on the phone solving issues that come up within our department how will I as a manager be complicated and her as a supervisor?

  83. Kelsey

    My husband works as a sport information director at a private university in Iowa. He is on a 10-month contract (but his yearly salary gets spread across each month of the year). How will this affect him, or will it? He makes way less than 47k a year.

  84. Sarah

    If you are paid on commission only and you usually make 47,000-50,000/yr but your weekly pay can range from $700 to $1,500/wk does your employer have to pay you at least $913/wk to not pay overtime? For example if you work 60 hrs one week and are only paid $700 commission that week does your employer have to pay over time for the hour over 40 for that particular week?

  85. Johnathan

    Now I’m hearing a lot of talk about “chinese overtime” or fluctuating work week. What does FLSA say about how employees are paid and is it true that under certain conditions they can be paid half-time over 40 hours worked? I assume this is for salaried, non-exempt employees.

      1. Johnathan

        Thank you. If I’m understanding this correctly, it looks like you are paid a fixed salary for 40 hours and your overtime rate for hours worked over 40 is your weekly salary divided by the number of hours worked and then multiplied by one half, hence “half-time” overtime pay. What I’m confused about is determining if the regular rate of pay is above minimum wage. So would you take the fixed salary amount, divide it by 40 hours and then use that to determine if the rate of pay is above minimum wage? If for example my salary were hypothetically $500 a week for 40 hours a week, my rate would then be $12.50 and therefore above federal minimum wage? Sorry but this is really confusing.

  86. Melisa

    Can my boss lower my hourly and make an allotment for 10 hours of over time weekly, that I would make to work, in order to maintain my current salary?

  87. Vicki Armstrong

    I am told by my company that when this new law goes into effect I will no longer be eligible for paid holidays, such as Christmas day. Is that true? Will paid vacation and accrued sick leave be taken off the table as well? For a law that is supposed to benefit employees, it seems to do the exact opposite.

  88. Puzzled

    I am told by my company that when this new law goes into effect I will no longer be eligible for paid holidays, such as Christmas day. Is that true? Will paid vacation and accrued sick leave be taken off the table as well? For a law that is supposed to benefit employees, it seems to do the exact opposite.

  89. Marc

    I work as a service tech in iowa….I get paid salary 39500 a year….as of right now I’m mandatory 45 hours a week and must track hours…on my off time I’m on call 24/7…and occasionally my job requires me to stay over night out of town how will Dec 1 affect me…how can I protect myself and what options does my employer have

  90. M

    My employer notified our office of the exempt salaried employees moving to non-exempt hourly employees. They claim that due to this change we will received our last check for our regular salaried work week on November 25. Then our next paycheck will be on December 9 with only one week of pay. The following check after that will be paid on Dec 23, but only with 2 weeks of pay.

    So with that being said, my entire office is losing a full week of pay until we are either terminated or move to another company. Since we are working two full weeks and only receiving one week of pay on Dec 9, doesn’t that qualify as an employer withholding funds from its employees?

  91. Connor

    I hold a Manger job, in charge of 2 fI’ll time employees and 1 part time, I work 37 hours a week at the office ( often times many more) but I also work 36 hours a week on call. I have to answer the phone from any locations, 1 day a week and every forth weekend my on call involves me driving around to some of our accounts. I make below 47,000 a year. Above 30,000. Will this due anything to affect me?

  92. Federico

    Well I’m making 42,000 a year but some time I have to come back 3 time to my work or answer phone call on my personal phone so now how it’s gonna be

  93. anon for this

    I am so thrilled. I just found out that my husband’s employer (he’s a computer programmer, entry level, for a public school district) is raising his pay to meet the threshold so he’ll remain exempt. I was expecting them to make him hourly to save the money, but apparently they chose to go the more expensive route since they didn’t want computer programmers on staff who were both exempt and non-exempt (as those in more senior positions already make above the threshold). That’s a $7,000/year raise for him, which will help our family tremendously!

  94. Ayotte

    My company is abiding to the expectations, but they have informed us that any time we do work that is over 40 hours will only be compensated with half time instead of time and a half. I have told the reason that are able to cut our hourly rate in half is because we are a public company. Is this really the case?

  95. Sophia

    What happens if a company fails to comply with the new laws?

    My boyfriend is going to be affected – he’s a restaurant manager, currently making $45k, and works well over 40 hrs every week. He asked his (notoriously flaky) boss about it yesterday, and she expressed complete ignorance of the new law. She has claimed she will look into it and follow up, but what happens if she doesn’t?

  96. David

    Does this make all employees under the threshold hourly employees? meaning, if my salary was based on a 40 hour work week, and under the new law, i would get over time, but if i only worked 30 hours on a slow week i would not get paid for a 40 hour week?

  97. Jim

    I work for a company that has two separate business’s in two different states. My pay is equally divided between both companies. I currently make more then the threshold cumulatively but not individually. I work at a high level in the organization, is there a loop hole where they can consider my income above the threshold even though it is technically being paid by two separate companies?

  98. Kaitlin

    Can a employer lower my annual total wages with the new overtime laws, im salary now and they are taking me to hourly. I currently make 35,000 annually, but they are changing my pay to 14.17 hourly with a maximum of 5 hour OT, how ever if I take vacation or sick time I will not receive any overtime pay, unless I work total of 40 hours not including the paid time off. So with 21 days a year that I would be off! That will significantly reduce my pay

  99. Lisa

    I am being moved from salary exempt to hourly Ann’s now my employer is going to withhold a week of pay. Can they legally withhold a week of pay?

  100. Janet

    I’ve heard through the grapevine that my company is waiting until Jan 1, 2017 to make the rate changes for those hired before Dec 1, 2016. Employees coming on in Dec 2016 will get the new changes. They are making some hourly and some will get the raise to comply with the law. Is it legal for the company to wait until Jan 2017 to change the current employees?

  101. Loopholes

    My company is choosing to pay hourly instead of giving the pay raise.
    Currently managers are on call 24 hours 5 days a week. Now managers will clock in while in the office doing their daily paperwork but are also assigned a daily 8 hour block that they will be on call that they will not clock in for. They will be compensated for only time worked while answering calls. The calls can be as short as answering questions but as intrusive as dropping everything to drive to the store to handle issues.
    I was under the impression that if you are on call with the expectation to drop everything to work, you must be paid for the hours you are standing by. Is this a legit work around to the new law or will all these managers be owed back pay for those on call hours?

  102. GPerkins

    I’ve been with the company 34 years currently paid at the new limit. All other managers are getting raises from $5000 to $9000 to get the the new limit. I received $1000 increase. Is this legal ?

  103. Jami

    My husband owns a small auto repair shop with 1 employee. They work 8-6 Monday through Friday sometimes more. This law is really upsetting him cause he doesn’t think the shop will survive paying overtime. My husband barely takes a paycheck himself. Is there anything we can do?

  104. goclmbmnt

    I oversee the management of a couple of large apartment complexes. The onsite managers all receiving their housing for free, but also collect a salary that is less than the limit. Can the value of the housing be included in the salary compensation?

  105. Very concerned

    Is it true that the new salary law was blocked by a federal judge just a few hours ago?? I don’t remember where I saw it but this is very nerve-wracking..

  106. Elissa Cooper

    I make above the cutoff ($48,800) but some others in my department make less than the cutoff, so the non-profit where I work has decided that everyone with my title will be non-exempt. They said there were legal issues with splitting the group. Is this true, and is there anything I can do to convince them I should remain exempt. I never have to work over 40 hours anyway, and I do NOT want to be an hourly employee.

  107. Spudz1313

    I was offeed a raise to 47,000 from 38,000 due to the department of labor law that was due to go into effect dec,1 2016. Due to the Texas judge injunction which will prevent the law to go into effect my company has postponed the wage increases. Being that I have a written agreement?

  108. KelMil

    Hi,
    I am currently an exempt coordinator of my company in CA, and making $40K annually. Due to the FLSA, I am qualify to get a raise and remain exempt to reach the minimum $47,476. However, my employer decides to offer to another position with additional job duties of what I am currently doing, and he is willing to raise to the the minimum wage under FLSA for exempt-employee. And my current position will be closed. My question is is my employer is ok to do that to offer me a new position in order to meet the requirement in FLSA? And my employer said I cannot stay in my current position. Should I asked for more than $47,476, which I know the people who are working on the same title have hire salary than the amount that my employer offered me. If I choose to resign after a month of transferring to the new position, will that consider as involuntary resignation and my employer will be violate the law?

    Thank you so much.

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