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You May Need an Attorney and Not Even Know It

What Will Happen When The New Overtime Rules Take Effect?

by Barry Butler

If you work more than 40 hours a week in a salaried position, you may sometimes bemoan the fact that you're expected to put in extra hours without receiving extra pay. While salaried positions can often carry with them perks like higher levels of responsibility or autonomy, in other situations they may simply be a way for management to cut overtime costs by classifying employees as exempt from the overtime requirements of federal labor laws. However, proposed Department of Labor (DOL) regulations may change this practice in 2016, requiring employers to pay overtime wages to all salaried personnel who earn below a certain threshold. Read on to learn more about this new DOL proposal and how it may affect you, as well as what you'll be able to do to ensure you receive all the pay you're owed. 

What proposed changes are coming to DOL overtime regulations?

Under current labor laws, employers are permitted to classify certain types of jobs as "exempt" from provisions of the wage and hour laws, particularly those governing overtime pay. Exempt positions often involve management or supervision of coworkers and employees such that it can be impossible to predict the number of hours you'll actually need to work during a given week. These exempt jobs are paid a fixed salary, rather than an hourly wage, and employees working exempt positions may not be compensated for extra hours worked unless their salary is less than $455 per week.

Under the proposed changes, this income threshold would increase to $970 per week in 2016 -- meaning that those who earn this amount or less are entitled to overtime pay for all hours worked in excess of 40 per week. In addition, the only types of jobs that can fairly be considered "exempt" are executive or administrative professional duties, rather than the fairly broad swath of job types eligible under current regulations.

How will these regulations affect you?

If you fall into the category of workers who aren't currently entitled to overtime pay, but will be under the new regulations, you may notice a significant jump in pay if you regularly work more than 40 hours per week. However, this money must come from somewhere, and many economists are concerned about the effect these mass salary increases may have on certain industries and employers. As a result, you could find your business cutting costs by reducing the number of hours previously "salaried" employees are required to work, thereby eliminating your chances to earn overtime pay.

What can you do to ensure you're properly compensated under these new regulations? 

If your employer continues to utilize your services for more than 40 hours per week after these changes are implemented, it's important to be aware of your rights to ensure you're fairly paid. You'll want to keep careful track of your hours worked (if your employer doesn't already) and calculate the amount you're owed based on your regular hourly pay. If your employer seems reluctant (or unwilling) to make pay changes in response to the new DOL regulations, you may want to preemptively seek legal services by speaking to a labor and employment attorney to ensure you've taken steps necessary to protect your job and your finances before coming to your employer with a demand. 

Fortunately, even if your employer fails to pay you these overtime wages at first, your claim won't expire -- you'll still be entitled to receive back pay retroactively to the initial effective date of the DOL regulations. Therefore, while it can be important for your monthly budget to straighten these pay issues out quickly, you have time to seek legal counsel if you feel this could be a larger battle than initially anticipated.