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New FLSA Overtime Salary Threshold - Mission to Grow: A Small Business Guide to Cash, Compliance, and the War for Talent - Episode # 100
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A recent ruling from the DOL has moved to raise the FLSA overtime salary threshold to $58,656 by 2025, and is poised to affect around 4 million employees. Here to help you prepare for the upcoming change is VP HR Compliance and Learning and Development at Asure Software, Mary Simmons!
Mary joins Host Mike Vannoy to discuss the nuances of the new threshold, and how employers can best prepare for the change. Mary shares ways you can communicate the change with employees, the challenges of transitioning employees to hourly, and the importance of a strong overtime policy.
Takeaways:
- The Department Of Labor recently moved to raise the FLSA salary threshold for exempt workers. The previous threshold was $35,568 a year, on July 1st 2024 it will increase to $43,888, and on January 1st 2025 it increases again to $58,656 per year.
- This higher threshold is estimated to result in a total $1.5B increase for salaries for employees, and employers need to be ready. While there are still a few months before the change, employers need to prepare for the transition now.
- This new increase will cause situations where existing employees are now paid the same as new employees. To help the disparity, increase existing employees salaries if possible, or offer them additional benefits like increased vacation time.
- While some employees will be getting a salary increase, some will be made hourly employees instead. While this can help your business, communication is key. Make your employees feel like a part of the decision and don’t make false promises.
- When you transfer employees from exempt to non-exempt, it’s crucial to clearly communicate the new rules. Write down the new rules and overtime guidelines for hourly employees, and ensure employees read and sign the new rules.
- As you transition employees to hourly, it’s important to consider what guidelines you need to follow. While extra hours outside of a regular schedule counts, something as simple as asking an employee to respond to an email after hours also counts.
Quote of the Show:
- “The way you communicate things to your employees is going to significantly change how they accept what you do.” - Mary Simmons
Links:
- LinkedIn: https://www.linkedin.com/in/marysimmonshrconsultant/
- Company Website: https://www.asuresoftware.com/
Ways to Tune In:
- Spotify: https://open.spotify.com/show/2XThTdn7YC1lkAm0PgZUkj
- Apple Podcasts: https://podcasts.apple.com/us/podcast/mission-to-grow-a-small-business-guide-to-cash-compliance-and-the-war-for-talent/id1725890976
- Amazon Music: https://music.amazon.com/podcasts/328dddd0-3c4f-4b07-a0d3-13bdcb418486/mission-to-grow-a-small-business-guide-to-cash-compliance-and-the-war-for-talent?refMarker=null
- Audible: https://www.audible.com/pd/Mission-to-Grow-A-Small-Business-Guide-to-Cash-Compliance-and-the-War-for-Talent-Podcast/B0CS71KQFM?qid=1706208857&sr=1-1&ref_pageloadid=not_applicable&ref=a_search_c3_lProduct_1_1&pf_rd_p=83218cca-c308-412f-bfcf-90198b687a2f&pf_rd_r=A1ME8MBECSVZ6K4D7CNT&pageLoadId=QBtg12mqKsuZPLGY&creativeId=0d6f6720-f41c-457e-a42b-8c8dceb62f2c
- Podchaser: https://www.podchaser.com/podcasts/mission-to-grow-a-small-busine-5591006
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