The Department of Labor’s May 18 final rule on overtime proposes changes that will cause an estimated 4.2 million workers to lose their exempt-from-overtime status when the rule goes into effect on Dec. 1, 2016.
In a recent article, the Tampa Bay Times describes what this means for approximately 331,000 Florida workers who will be impacted by the new rules. The rules will also greatly impact Florida businesses, which will have to make big changes in the next six months.
Gunster attorney Eduardo Suarez-Solar told the Tampa Bay Times that in order to comply with these new rules, business owners and executives are facing options unappealing for both employer and employee.
Suarez-Solar describes a few of the options business owners and executives should consider:
- A business may implement a policy requiring a 40-hour workweek with no additional hours approved for its nonexempt employees. This may help eliminate overtime pay, but also limits what a business may be able to accomplish in a given workweek. (However, if those nonexempt employees work more than 40 hours, employers must pay them overtime, but may choose to discipline the employees for not following policy or getting prior approval.)
- Employers may reduce the hourly wage of workers newly eligible for overtime pay. This decrease in pay would offset potential overtime to ensure a worker’s pay remains close to what it was before the new rules go into effect. However, this doesn’t guarantee overtime work to account for the discrepancy.
- Employers may raise some workers’ salaries so they will remain exempt from overtime.
Read the entire article: New Labor Department overtime rule expected to jolt Florida workplace (Tampa Bay Times, 5/20/16)
- New overtime exemption rule: Win for workers or business boondoggle? (South Florida Business Journal, 5/20/16) note: subscription required.
- Changes to overtime rules effective Dec. 1 (Gunster.com client alerts, 5/19/16)