Are you prepared for the latest Department of Labor overtime rules that were released March 7th? The new standards formally replace the 2016 guidance and would make approximately 1.1 million employees nationwide eligible for overtime when employers act to adjust current status. Set to go into effect on January 1, 2020, here’s what you need to know.
New Changes to Overtime Rules
- Minimum salary increasing to $35,308
- Highly Compensated Employee (HCE) level increased to $147,414
- Allowances to use certain bonuses and payments in the calculation of salary level
Preparing for the New Overtime Rules
- Conduct an internal audit, review employee classifications and determine employee groups that may be affected. What action should you take?
- Establish internal policies for approving overtime before worked. Do non-exempt employees work remotely? How are hours tracked? Having a clear policy and method for tracking and approving overtime will make this update and subsequent updates to the salary threshold much easier to manage.
- Avoid common overtime mistakes. What work is compensatory? Are paid breaks required? Do you have proper record keeping?
- Stay informed and train managers. If you depend on other staff to make related decisions, complete training soon so they are prepared to adjust practices and inform employees.
For more assistance in navigating these new changes, the Aldrich Benefits team is ready to help.
Meet the Authors
Aldrich Benefits LP
Amy Berry began her Employee Benefits career in 1999 and joined Aldrich Benefits in April 2019. Prior to joining Aldrich, she spent 15 years at a local insurance carrier working with employers on large fully insured plans, self-funded plans, and MEWAs. Amy helps structure employer benefit plans to meet the group’s financial budget while at the…
Aldrich Benefits LP
Mandi has over a decade of experience in the employee benefits world. Prior to joining Aldrich, Mandi served as an account manager at a brokerage firm in Portland, Oregon, specializing in health and life insurance for groups ranging from 100-4,000 employees. Her experience also includes providing benefit calculations for retirement plans at a large actuarial…
- Self-funding and complex contracting
- Consumer-driven healthcare plans
- Plan compliance
- Financial Analysis