Effective January 1, 2020, the rules for overtime pay have changed. Employees who earn less than $35,568 annually are eligible for time and a half overtime pay under a new U.S. Department of Labor rule. The new threshold goes hand in hand with how your employees are classified as either exempt or non-exempt staff.
Exemption status is not only dependent on salary thresholds but must also take into account the duties the individual performs for your company. Salary and duties, not job title, are critical when determining exemption status. Use this link to learn more about rules regarding exemption status https://www.dol.gov/whd/overtime/fs17a_overview.pdf
Once you have determined an employee status and set a rate of pay, double check your benefit plans. Some benefit plans are tiered according to employee’s status as a salaried or hourly employee. Your retirement plan may also need a review as yearend discrimination testing may need your attention.
Taking the time now to review salary, exemption status and how it may affect your benefit plans may save you time and money later in the year.