Earlier this year, The Department of Labor announced a Final Rule on overtime pay. Hopefully, you’ve had time to prepare for implementation, which occurs December 1, 2016.
Here are some key provisions of the Final Rule:
- All workers earning up to $913 per week, or $47,476 annually for a full-year worker, must be paid at the overtime rate for any time worked beyond 40 hours per week.
- Overtime pay rate is time and one-half the regular hourly rate.
- The threshold for highly compensated employees has gone up, from $100,000 to $134,004.
- Automatic updates to these thresholds will be made every three years, beginning January 1, 2020.
Employers have three choices for overtime work: they have the option to limit workers’ hours to 40 per week, pay them time and one-half their regular hourly rate for all hours worked over that limit, or to hire part-time workers to keep full-time employees from working overtime.
For more information, see the Department of Labor’s Overview and Summary of Final Rule.
If you have questions, please contact our CPAs. We welcome the opportunity to assist you with any of your business needs.