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Sue Meisinger Explains New FLSA Overtime Changes

2016 flsa

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[Update: The Department of Labor published the new rules on 5/18/16. You can find more details on the new FLSA rules here.]

In this podcast I talk to Sue Meisinger about the US Department of Labor’s proposed changes to the FLSA overtime exemption rule for salaried workers.   In July of 2015 the DoL published a Notice of Proposed Rulemaking, indicating that they would considerably raise the threshold for salaried workers who would be eligible for overtime under the new rules. The impact of the anticipated changes includes a significant change in the minimum salary threshold for exemption from overtime – from $23,660 to $50,554 per year.  The DoL expects the change to positively impact the lives of 5 million white-collar, salaried workers. We anticipate that the final rule will be announced anytime between May and July of this year, providing organizations with a short window of time to comply.

Sue is uniquely qualified to help us understand these changes and what they mean to organizations.  Before her stint as the president and CEO of SHRM, Sue worked for the U.S. Department of Labor for years, overseeing the agency that enforced a number of federal laws around minimum wage, overtime, and child labor. In addition, Sue has a law degree from the National Law Center of George Washington University, and is a member of the District of Columbia Bar Association.

In our conversation, we addressed the questions below.  You can hear our conversation here:

  1. Can you help our audience by providing a layman’s overview of the proposed FLSA OT changes and how businesses will need to adjust their practices as you see it?
  1. Do you think organizations are prepared to track their white collar time and labor? In other words, will this be an easy regulation for U.S. companies to comply with and will employees understand what’s expected of them?
  2. What are some of the industries you think will be most affected if this proposed rule becomes law?
  3. For those salaried workers who fall into the new OT eligibility bucket, many are folks who work with a flexible schedule. They answer emails at home and all hours of the day. They finish projects on the weekend. They may travel often for sales calls or tradeshows. They also may spend hours during their work day taking mental breaks, paying bills, chatting with colleagues about non-work issues, and surfing the Internet and social media. Would this change open up a major debate into ‘What is work?’ for these types of employees
  4. While the proposed rule change was created with all the best intentions for American families, do you see any unintended consequences brewing for organizations and their employees if this proposal is made law?
  5. While, on the surface, the proposed changes appear to benefit employees at the expense of their employer, is there a silver lining that benefits both employees and companies?
  6. What are critical activities that businesses should start doing today so that they are well-prepared?

As a bonus feature to this podcast, I hope you’ll enjoy the video at the top of this post. This was created by the Department of Labor to provide a quick overview of the proposed changes and why they are being made.

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4 Comments Post a comment
  1. Great podcast! CUPA-HR co-chairs the Partnership to Protect Workplace Opportunity with SHRM. Here is the link to a recent video we produced that emphasizes the potential impact on higher ed, other non-profits and small business. blog.cupahr.org/2016/04/proposed-ot-rule-could-end-up-hurting-those-it-intends-to-help/ Changes to the FLSA are long overdue, but the magnitude of the proposed changes is not acceptable. Best wishes to my Workforce Institute colleagues!

    Andy Brantley
    President and CEO
    www.cupahr.org

    May 9, 2016
  2. Joyce Maroney #

    Thanks for taking the time to comment, Andy. And thanks for sharing your additional resources on this important topic.

    May 9, 2016
  3. Highly relevant and well articulated podcast.

    As far as the subject matter – I applaud the efforts by DOL to increase the minimum salary threshold for FLSA purposes. This change is beyond overdue. Still, the proposed aggressive implementation timeline seems irresponsible. A more measured approach for the implementation of this increase would be to enact the increases proportionately over a 3 or 4 year period.

    May 10, 2016
  4. Very informative podcast. Great job by Sue and Joyce. There is a need to increase the salary basis threshold. At least in the public sector, the impact of the proposed regulations can vary greatly depending on your geographic location. The International Public Management Association for Human Resources would have preferred a lower salary basis threshold and/or locality adjustments that take into account cost of living differences.

    May 10, 2016

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