In a major (and surprise) ruling, a federal judge in Texas has issued a preliminary injunction blocking the Department of Labor’s new overtime rule scheduled to go into effect on December 1, 2016. The new rule would have increased the minimum annual salary requirements for exempt employees will from $455 per week to $913 per week (or from $23,666-$47,476 per year). Importantly, although 21 states participated in the lawsuit, US District Judge Amos L. Mazzant rejected a request by the Department of Labor to limit the injunction to the states that filed the lawsuit and instead issued an order blocking the new rule nationwide. WHAT DOES THIS MEAN FOR EMPLOYERS AND WORKERS? For now, employers who rely upon the “white collar exemptions,” referred to as the executive, administrative, and professional exemptions, will be permitted to continue paying the minimum salary requirement of $455 per week. In order to classify an employee as salaried “exempt,” the employer must satisfy both the salary requirements and the “duties” requirements of the exemptions. Most overtime claims and overtime liability arise out of an employer’s failure to satisfy the duties requirements for the exemption. For example, the “executive” exemption Employers rely on (sometimes referred to as the “managerial” exemption) requires the employer to demonstrate that the employee’s “primary duty” must be the management of a department or division of the company AND that the employee regularly directs the work of two or more full-time employees (or full-time equivalents) AND that the employee must have the authority […]Read More
About the Fair Labor Standards Act Wage and Hour Laws The Fair Labor Standards Act was enacted more than 75 years ago to establish workplace hours, wages and child labor standards in the United States. The FLSA sets the federal minimum wage, which is updated periodically by legislative action, and determines what is considered compensable hours of work. In addition, the statute contains a variety of exceptions to minimum wage, overtime pay rights and the hours that constitute a workweek. Minimum Wage and Overtime Pay The federal minimum wage is currently $7.25 per hour. Florida’s minimum wage is $8.05, which prevails because it is more than the federal amount. Businesses are permitted to pay their tipped employees $5.03 per hour and take a tip credit of $3.02. In most circumstances, employees are subject to a 40-hour workweek. Businesses must pay employees at a rate of time plus time and one-half for hours worked over 40 in a workweek. Businesses are not required to pay extra for holidays or weekends unless the employee is working overtime on those days. Exceptions exist for certain types of occupations, such as first responders, military servicemembers, nurses, construction workers, technicians and certain blue-collar workers. In addition, executives, professionals, administrators, computer-related occupations and outside sales representatives are not subject to the overtime requirements. For this reason, correct classification is crucial. Compensable Hours Determining which hours are considered work is not always straightforward. The FLSA provides some guidance, but a business must also adhere to its own […]Read More
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