FLSA Changes

We have been staying on top of the Department of Labor's (DOL) proposed changes defining which employees are exempt from the minimum wage and overtime pay requirements of the Fair Labor Standards Act (FLSA). The Labor Department announced the changes May 17, 2016, many of which were expected. The final ruling makes the following important changes:

• Raise the salary threshold from $23,660 to $47,476 a year, or from $455 to $913 a week. Nearly all workers earning salaries beneath that threshold are entitled to time-and-a-half pay whenever they work more than 40 hours in a week. The Labor Department will now update the threshold every three years to make sure it keeps pace with inflation.
• The new ruling makes no changes to the “duties test” and allows bonuses and incentive payments to count toward up to 10 percent of the new salary level.  Workers earning more than the salary threshold are still subject to the duties test to determine eligibility for overtime.
• The effective date of the final rule is December 1, 2016. The initial increases to the standard salary level will be effective on that date. Future automatic updates to those thresholds will occur every three years, beginning on January 1, 2020.

Because of the unique exposures facing women's fraternities and sororities, MJ Sorority sponsored a recent webinar with Michelle Anderson, non-profit employment expert, of Fisher & Phillips LLC who joined us to discuss how the FLSA changes will impact our clients specifically. We highly encourage all employers to review the recorded webinar in its entirety.

All employers should familiarize themselves with the changes and prepare for their impact prior to the effective date of December 1, 2016. We recommend you review several resources directly from the Labor Department, including the final rule in its entirety and FAQs. In addition, we have included links to several helpful resources below.

If you are in need of legal advice on this complicated issue, we recommend contacting Michelle Anderson of Fisher & Phillips, as she is very familiar with the FLSA changes, as well as the specific nuances that apply to women's fraternities and sororities.

Should you have any questions or concerns, please do not hesitate to contact your Client Executive.