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During this session, our HCM Analytics team will:

  • Discuss your current plans for workforce changes to manage the next 30 to 90 days and provide feedback on potential risks and opportunities
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  • Suggest key metrics for you to track so you can forecast labor costs better and make earlier interventions

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new dol overtime rulesWith the weather getting warmer, you probably have summer on your mind. But you can thank the Department of Labor (DOL) for a potentially busy summer and less time by the pool. The DOL is set to pass new overtime rules this July.

The proposed rules to the Fair Labor Standards Act (FLSA) were unveiled last year to keep up with inflation. The proposed rules mandate that workers who earn less than $50,440 be made eligible for overtime.

This would make more than 4 million workers eligible for overtime, potentially costing companies an additional 250 million per year.

DOL Overtime Rules

In 2015, these rules were simply “proposed rules.” However, last month, M. Patricia Smith, the Solicitor of Labor, revealed that the DOL hopes to finalize new overtime rules by July 2016. She also revealed that the regulations will be effective within 3 months of the published date.

That means companies will have 60 days to prepare their company for compliance with the new overtime regulations.

This new ruling could affect your summer vacation plans. So plan ahead. There are many different ways your company can prepare before the 60 day period.

Assess the potential impact.

Identify all your salaried employees earning between $23,660 and $50,440 that are classified as exempt. Start tracking hours for these employees (if you are not already doing so). Determine who is working more than 40 hours in one week, and calculate what their overtime will cost you if their workload remains unchanged.

From there, determine what tasks and projects are requiring your employees to work extra hours. Is the workload too great? Are there inefficient processes in place? If your workforce management system allows you to allocate time to various tasks, take advantage of the insights it can provide regarding how employees spend their time.

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Plan your strategy.

If it looks like you’ll have to pay significant overtime expenses with the new rules in place, you’ll want to limit potential overtime exposure, but not at the expense of productivity. You’ll want to assess staffing levels and make any changes as needed.

Consider hiring part-time or outsourcing a contractor as a cost-effective way to handle certain projects. Calculate whether it might be more cost-effective to give non-exempt employees making close to the $50,440 salary threshold a raise that puts them over the threshold, rather than paying them overtime.

Take advantage of an automated workforce management system.

If your business is using manual or piecemeal systems, you’re at greater risk of compliance violations. Employers can assume that their adherence to new overtime rules will be closely monitored.

Chances are, this will translate to large legal settlements and DOL fines for unprepared employers. Now is the time to evaluate your workforce management system and see how it stacks up with regards to time tracking, task tracking, employee scheduling and calculating overtime correctly.

Don’t let the proposed overtime rules catch you off guard this summer. Start preparing now—download the eBook, What the Proposed DOL Overtime rules Mean for Your Business to learn more.