nQativ Blog Ready or Not, New Overtime Rules Take Effect December 1

Seems like Payroll and Human Resources departments are doing all the heavy lifting in the business world these days. What with the Affordable Care Act and the massive effort that complying with it entails, now along comes the Department of Labor with new rules about overtime pay. The rules take effect December 1, 2016; however, it's not too early to determine your compliance strategy and how to use Activity to make the transition from old rules to new rules seamless.The most impactful change the rules mandate is the leap in the salary threshold from $23,360 to $47,476 per year (or from $455 to $913 per week). Yes, you read that right, slightly more than double the prior threshold. This could make a healthy percentage of your personnel newly eligible for overtime. This could mean raising the pay for some of your employees to avoid the overtime rule, or converting salaried employees to hourly pay. You may need to monitor employee hours more closely to prevent overtime, or you may need to hire more employees to spread the load so that overtime is not necessary. You may even want to restructure the pay for these folks altogether. Unlike this most recent change to the salary threshold which was 12 years in the making, the new overtime rules mandate that salary thresholds going forward be revised automatically every three years.Other highlights of the new rules include:The salary threshold for highly compensated employees is changing too, rising from $100,000 to $134,004.Non-discretionary bonuses and incentive pay, made monthly or more frequently, can be used to satisfy up to 10% of the salary level test.No changes were made to the duties test.Whatever your approach to the overtime dilemma, nQativ and its advisors stand ready to help you implement the changes you need in your Activity system. When you're ready to tackle this challenge, drop us a line at support@nqativ.com or call 800.354.7152. Prepare early; don't get caught in the Thanksgiving rush!