As of the new year, an estimated 1.2 actor added salaried advisers in “white-collar” positions will become acceptable for overtime pay, commutual an accomplishment to amend federal regulations that had not afflicted in 15 years.
This should not be alien for employers, as a antecedent attack to change the bacon beginning to absolved assertive advisers from overtime requirements was batty by the courts in 2016. Despite that setback and a new White House administration, a change to how the Administration of Activity (DOL) mandates who can accept overtime pay was inevitable.
When we anticipate of the industries that will be best afflicted by this new rule, the focus may go to the bloom affliction or accounts industries, which are abounding with advisers in lower-level authoritative roles. The appulse will be widespread, however, and businesses in all sectors should be prepared, including construction.
With added aqueous job descriptions and agent roles at companies, the architecture industry has added advisers who will become overtime-eligible than administering may realize. With alone weeks larboard afore the new regulations booty aftereffect on Jan. 1, 2020, architecture professionals who accept yet to abode the change accept no time to spare—and those who anticipate they are in the bright may not be.
Under the Fair Activity Standards Act, administering charge pay workers time and a bisected for hours formed in balance of 40 hours in a assignment week. Currently—but not for abundant longer—employees assuming executive, authoritative or able duties and paid added than $455 per anniversary ($23,660 annually) are absolved from overtime requirements.
With the accepted beginning accustomed in 2004, there was about accepted accessible appeal that it be increased. In 2016, the Obama administration’s DOL attempted to bifold it and authorization automated adjustments, but the aphorism was begin actionable in a federal court.
The new aphorism sets the beginning in amid the accepted one and the 2016 rule, adopting the “standard bacon level” to $684 per anniversary ($35,568 annually). Accordingly, anyone authoritative beneath that bulk —even if the agent is assuming duties that abatement into “white-collar” categories—will be acceptable for overtime.
The final aphorism additionally includes a accouterment that allows administering to use nondiscretionary bonuses and allurement payments (including commissions) that are paid at atomic annually to annual for up to 10% of the accepted bacon level.
Before the 2016 aphorism was addled down, abounding administering accomplished out attractive to amend their policies, job descriptions and duties, authoritative abiding they knew which advisers would be acceptable for overtime. Notably, a accepted delusion that existed again abominably is still accustomed today: Abounding administering accept so continued as an agent receives a bacon (as against to actuality paid on an alternate basis), that agent is absolved from overtime pay. This is incorrect, though. The absolution is alone applicative back an agent meets both the bacon beginning and has primary duties that accommodated the requirements.
The DOL has accessible actuality bedding that breach bottomward the specifics of what qualifies as executive, authoritative and able duties, admitting it’s the aboriginal two categories that will administer best to absolved positions begin in the architecture industry.
A abrupt overview:
Often back companies booty an all-embracing attending at the absolute job duties advisers are performing, they ascertain that advisers accept been misclassified. This is abnormally accepted aural architecture firms, as one agent can abrasion abounding hats depending on the affairs and the project.
For example, a nominally desk agent may absolutely absorb cogent amounts of time managing a few advisers in the acreage and assuming chiral work. Sometimes, too, a worker’s duties advance afterwards anyone demography agenda of it in an official capacity. Perhaps the agent takes on the nonexempt duties of a aide on leave, or maybe the agent underperforms in one role and moves into addition acute altered abilities and responsibilities. Any time an employee’s duties evolve, it can change whether that agent is acceptable for overtime pay—even if that employee’s official job description or bacon would arise to say otherwise.
Job descriptions are not alone important to actuate overtime eligibility. It is capital that someone’s absolute duties bout his job description back it comes to accurateness in authoritative processes and proceedings, such as affliction and workers’ advantage claims or doctors’ fettle for assignment releases.
As mentioned above, the proposed aphorism change of 2016 spurred abounding administering to booty a beginning attending at their operations and adapt for new overtime requirements. This time around, there does not assume to be the aforementioned faculty of urgency. It could be that the new aphorism is aerial beneath the radar, that administering are not advantageous attention, or that they may anticipate they are adjustable with the new overtime rules afterwards reassessing a few years ago.
However, abundant can appear in a abbreviate aeon of time—new advisers may arrive, accepted advisers may booty on altered roles and business practices may change. Managers and animal assets cadre should always be allegory their employees’ job descriptions, their bacon levels and how these evolving factors may affect their overtime eligibility.
If advisers are misclassified and are not appropriately paid overtime, they can book an authoritative affirmation with the federal or accompaniment administration of activity or book a lawsuit. At that point, a aggregation faces advantageous the agent backpay and bifold damages. A authoritative analysis is acceptable to aftereffect in added overtime violations actuality begin for added advisers as well, appropriately compounding the impact.
When reassessing agent salaries, duties and job descriptions, in some cases, administering may acquisition it easier and added cost-efficient to accession workers’ salaries to the new bacon threshold, or they may appetite to catechumen advisers to an alternate amount and apparatus behavior to absolute boundless overtime. This is area a time-tracking arrangement can be useful.
Connecting with a acknowledged able will be the best footfall for a aggregation to accomplish abiding it is accessible for the new overtime rule. From the reaction, or abridgement thereof, from administering this time around, it is accessible there are abounding who charge to analysis their policies, job descriptions and employees’ overtime accommodation to abstain potentially ample acknowledged liabilities for advisers who are misclassified.
Elaina Smiley is an advocate with Pittsburgh-based law close Meyer, Unkovic & Scott. She focuses her convenance on application and clearing law. Contact her at es@muslaw.com.
Joshua Lorenz, an advocate at the firm, focuses his convenance on architecture and absolute acreage law and litigation. Contact him at jrl@muslaw.com.
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