New overtime rules go into effect December 2016

Image courtesy of Adobe Stock.

Image courtesy of Adobe Stock.

It is only a few months until lots more people must be paid time-and-a-half for the actual hours worked beyond 40 a week. This will likely affect a huge number of charities and churches.

Just so you get the picture, after 12/1/16 your charity will need to track the actual hours for any full-time administrative staff or program managers earning less than about $47K and pay them for all hours worked over 40 per week.

Here are two more articles providing an intro to the issue.

5/23 – Associations Now – Overtime rule released: how organizations can prepare – additional discussion on how to start planning for the new overtime rules.

Article points out the serious legal costs of tripping over the rules. Potential exposures will make this a lucrative target for plaintiffs’ attorneys.

7/7 – CFO magazine – New Overtime Pay Rules: How to Adjust – Article gives a feel for how complex this will be. Also provides a warning that these rules will likely increase the number of wage & hour lawsuits. Keep in mind there are double damages for FLSA issues along with attorney’s fees.

The threshold for having to track hours and pay for overtime worked will go from about $24K a year to about $47.5K.

Three questions covered in the article:

What workers are affected?

How should compensation be adjusted?

This will be very tricky. One of many options is to adjust pay rate from a salary to what the hourly rate would be with typical overtime hours backed out at time-and-a-half. I foresee that causing massive morale issues.

What risks are involved?

Lots of ways this could go sour.

Here are two more of my posts on point:

If you haven’t starting looking at this issue, please begin.

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