In a blog I posted on June 25, 2016, “Time to Start Preparing for The New Overtime Regulations”, I discussed what was slated to become a major change to the Fair Labor Standards Act (FLSA) on December 1, 2016. Well, not so fast. Last month, a federal judge in Texas issued a Court Order blocking the implementation of the new regulations which would have increased the minimum salary to $47,476 annually for an employee to qualify for the executive, administrative or professional exemptions (the so called “white collar exemptions”). While employee-rights groups celebrated the new regulations, many business groups felt that the new regulations put extra financial pressures on businesses that were already having difficulty surviving in the current economy and that the Department of Labor had overstepped its authority with the new regulations. Thus, lawsuits were filed which culminated in the federal judge’s decision, which applies nationwide, and basically keeps everything status quo for the time being and employers do not have to make changes by December 1, 2016.
However, while I was presenting seminars on this topic during the past few months, I discovered that many employers are still misclassifying their employees and, as a result, may be failing to pay required overtime. Many employers simply believe that they can pay their employees a non-fluctuating salary, and somehow they are magically in compliance with the FLSA. This is not the case. An employee’s job duties dictate if he/she is entitled to overtime. The fact that the federal judge has stayed the impending regulations, does alter the basic rule that employees whose job duties do not qualify for an exception under the FLSA must be paid overtime.
For more information on the classification of employees under the Fair Labor Standards Act, please contact Scott A. Mirsky at (301) 664-7710 or firstname.lastname@example.org.