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Update on Overtime Rules - December 14, 2016

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Department of Labor overtime rules have been delayed. With the results of the recent presidential election and the recent court injunction, many are wondering if and how this will impact the new overtime regulations.

Join us for this educational webinar in which we will cover:
- Overview of the new DOL rules
- Understanding the impact of the injunction to delay the implementation
- Industry specific exemptions and exceptions from overtime
- What tools and resources does KPA offer for clients to comply with the new rule?

This webinar will be presented by Kathryn Carlson, Vice President of HR Management Products. Kathryn has over 25 years of human resources management experience and is a certified HR professional. For the past 13 years she has focused on developing HR software and programs to improve efficiency, reduce risk, and ensure compliance for companies ranging from small businesses to international corporations.

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Update on Overtime Rules - December 14, 2016

  1. 1. Better Workplace Better Workforce Better World Update on Employee Overtime Rules December 14, 2016
  2. 2. KPA: Environmental Health & Safety | HR Management |Sales & Finance Compliance KPA delivers Environmental Health & Safety, HR Management and Sales & Finance Compliance programs with a vision of creating a Better Workplace, Better Workforce, and a Better World. Over 6,500 clients, across 48 states look to KPA as their compliance partner providing solutions through a combination of innovative software, interactive training and on-site consulting, resulting in increased production and profits. A comprehensive solution for Environmental Health & Safety, HR Management, and Sales & Finance Compliance.
  3. 3. Questions • If you have questions during the presentation, please submit them using the “Questions” feature • Questions will be answered at the end of the webinar •If your question does not get answered, we will reach out to you individually
  4. 4. What happened? • An injunction was issued that delay the implementation date, which was to be December 1st • The DOL filed an expedited motion of appeal on December 1st • The rule might still be enforced and retroactively to December 1st
  5. 5. What do we do? • Employers don’t have to revert back to old rule • But if they do state notice requirements will apply • Inconsistent pay adjustments will cause issues
  6. 6. What was that rule again? • Exemption from Overtime = $47,476 ($913 per week) More than $455 but less than $913 will need to be reclassified • No changes to duties test • 3 year increases • Ability to count bonuses, commissions and incentive payments
  7. 7. Federal Exemptions MINIMUM WAGE/ OVERTIME/ RECORDS • Executive • Administrative • Professional • Highly Compensated OVERTIME ONLY • Salesman • Partsman • Mechanic • Commission-paid • Motor Carrier The FLSA also has an exemption from the overtime pay requirements for certain commission employees of a retail or service establishment. For this exemption to apply, three requirements must be met: (1) The employee must be employed by a retail or service establishment; (2) The employee’s regular rate of pay must exceed one and one half times the applicable minimum wage; and (3) more than half of the employee’s total earnings in a representative period must consist of commissions on goods and services.
  8. 8. Three Factors • How is the employee paid? • How much is the employee paid? • What does the employee do? The employee must be paid a salary, must make a minimum of $913 per week/ and must meet all of the qualification of one of the duties test to be classified as exempt.
  9. 9. The Duties Test 1. Executive 2. Administrative 3. Professional 4. Computer (rarely used in dealerships) 5. Highly Compensated Employees “highly compensated employee” exemption under 29 U.S.C. § 541.601. The relevant section of the regulation reads: “An employee with total annual compensation of at least $100,000 is deemed exempt . . . if the employee customarily and regularly performs any one or more of the exempt duties or responsibilities of an executive, administrative, or professional employee.”
  10. 10. Federal versus State Law • Federal law does not preempt state employment laws • Employees are entitled to the provision most favorable to them
  11. 11. Payroll Practices: Red Flags Watch out for “red flags” regarding payroll practices: – Improper deductions from salaried employees – Improper calculation of “regular rate” – Job descriptions for exempt employees that do not reflect exempt duties – Nonexempt employees working through meal breaks – Nonexempt employees performing work before or after they punch or log in/out – Employees who routinely stay late but have no overtime – Not complying with employer’s own written policies
  12. 12. “Are they exempt from overtime?” • What does the employee spend the majority of his time doing? • How is employee’s pay plan structured? • Does employee fit exactly into one of the nine exemptions?
  13. 13. Common Classification Mistakes • Not considering differences in state and federal salary and duties tests • Treating trainees as exempt before they fully qualify as exempt • Failing to guarantee the proper minimum salary • Prorating the salary of a part-time exempt employee to less than $913/week • Making improper deductions from salaries of exempt employees
  14. 14. Questions and Answers 14– KPA CONFIDENTIAL – QUESTIONS?
  15. 15. Contact Information 15 www.kpaonline.com kcarlson@kpaonline.com 866-356-1735

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