FLSA Regulations Preparation
With the new FLSA rules going into effect in three weeks, on December 1, 2016, FLSA analysis and compensation planning is critical for all employers.
What does it mean?
The Department of Labor’s final rule updating the overtime regulations will automatically extend overtime pay protections to over 4 million workers within the first year of implementation.
How will it impact your business?
Executive leadership teams are starting to wonder if these new regulations will cause labor costs to increase and how they can comply with the new overtime regulations but effectively manage these increases. Here are a few ways companies are making changes to address new compliance standards within their organizations:
- Convert managers and other positions from salary to hourly schedules and limit their work hours to 40.
- Increase salaried amounts to the new minimum of $47,476 per year to avoid additional overtime costs.
- Reduce base pay rates to a lower level so that when overtime occurs the effective pay will be the same.
- Reduce headcount so that they can absorb the expected increase in labor costs.
- Raise prices to offset the expected increase in their labor costs.
How can vcfo HR Solutions help you?
We can assist with the diagnosis of the impact and help you develop scenarios to support post December 1 plans. Our experienced consultants can assist in the review and creation of job descriptions for a number of positions. This includes:
- A review of current data collected by the HR team.
- Phone or in-person interviews with employees/supervisors.
- A collection of specific job information.
- Write ups of descriptions.
- A position analysis to identify any titling or compensation issues across the organization.
- Storage of job descriptions in designated network library for ongoing use.
We can provide FLSA exempt vs. non-exempt position testing in various markets. This includes:
- Reviewing updated job descriptions and compensation amounts for each person.
- Identifying any positions which may be misclassified or may need a compensation adjustment prior to 12/1/16.
- Reviewing wage and hour policies and processes.
- Communicating the changes to employees.
- Training the reclassified employees and managers.
- Providing a presentation to human resources and the executive team with a summary of FLSA findings and suggestions on next steps, if necessary.