On December 1st, 2016 a new overtime law will go into effect. The new law will allow salaried workers, meaning individuals who receive a fixed rate of pay, who are paid less than $913 per week ($47, 476 annually), and who continue to perform executive, administrative, or professional duties, as defined by the U.S. Department of Labor’s duties test, will be eligible for overtime pay.
The old law that had been in effect since 2004 exempted individuals performing executive, administrative, or professional duties from overtime if they were paid at least an annual salary of $23, 660.
It’s estimated that 4 million individuals will benefit by receiving overtime or an increase in their salary when the law goes into effect.
My personal opinion is that I’m in favor of this law. During the 20 years I’ve been recruiting I’ve come across individuals from time-to-time working sixty hours a week, making $24,000 and because of their job classification were exempt from overtime. Many of the remarkable women were trying to raise a family on their salary, too.
Companies will have options as to how to comply with the new law. They include:
1. Paying workers time and a half for overtime if they work in excess of 40 hours a week
2. Raise the workers’ annual salary to meet the new threshold
3. Limit the number of hours an employee works to 40 hours a week
4. A combination of any of the above.
To read more about the new law and to find out if it applies to you go to the U.S. Department of Labor website.