LCIA held a breakfast workshop on October 26 in New Orleans focused on the upcoming changes to overtime laws. Louisiana Comp Blog editor Nina Luckman was in attendance, and Comp Blog published an article about the event.
The following are excerpts of Comp Blog’s recap:
"The event homed in on major changes to the Fair Labor Standards Act (FLSA) overtime rules, which will go into effect on December 1st, 2016. To head off confusion about how businesses could be impacted, LCIA invited New Orleans-based attorney Terese M. Bennett to speak on the issue and point employers toward relevant resources.”
"What are those objectives [of the new laws]? First, to ensure workers are provided with "fair pay for a fair day’s work.” Second, to "modernize and simplify” the Act. And third, to ensure that FSLA’s intended protections are fully implemented. In other words, according to Bennett, "to put more money in people’s pockets” for the hours they work – whether they are salaried "professionals” or not.
To claim what is commonly know as the "white collar exemption” for a certain employee, employers use three tests: the salary basis test, the job duties test, and the salary level test. The salary level test is what will change December 1st. Now, an ordinary employee (not computer-related or "highly compensated”) must make at least $47,476 per year ($913/week) in order to be exempt (i.e. ineligible for overtime pay). This is effectively double the previous threshold.”
"The game plan for employers: preparation and options
While Bennett acknowledged that the changes are overwhelming at first, she gave attendees the step by step rundown of what they can do to get into compliance over the next month:
- Evaluate employees’ current salaries and wages
- Assess the financial impact on the organization as a whole
- Evaluate Independent Contractors (1099s) using the "economic realities test”
- Develop a communication plan to keep morale up among employees that may be re-classified as hourly, or otherwise shuffled
- Seek legal and tax guidance prior to implementing classification changes”
"Bennett closed her talk with some key resources for further reading and preparation including the DOL’s Wage and Hour Division Fact Sheets: 1-866-4USWAGE (1-866-487-9243) and this explanatory video.”
Click here to read Comp Blog's entire recap. Louisiana Comp Blog provides original reporting about the workers' comp industry in Louisiana. Comp Blog is sponsored by LCI Workers' Comp.