The Labor Department finally announced their long anticipated final determination and implementation date of the new salary threshold for salary non-exempt employees who are subject to overtime pay.colleagues-1238030-639x479

Beginning Dec. 1, 2016, all non-exempt salary employees who earn less than $47,476/yr, or $913/wk, will be subject to overtime pay. It essentially doubles the current salary threshold rate of $23,660, or $455/wk. The Labor Dept noted that this salary threshold would be updated every three years based on based on wage growth and will begin Jan 1, 2020.

Currently if an employee has management responsibilities and are paid more than $23,660, they are considered exempt from overtime. Come Dec 1, 2016, if those same employees are paid under the new threshold of $47,476, they will be subject to overtime. The new rule does not change the “duties test” used to determine if an employee is exempt. The rules also note that in some circumstances bonus payments can be included in wage determinations for compliance purposes.

The new rule also increases the wage level of highly compensated non-exempt employees, that is workers who are not considered exempt as per the “duties test”,  from $100,000 to $134,004.

It is estimated that up to 5 million workers will be effected by this new ruling which was a result of an Obama Administration Executive Order.

An effective date of Dec. 1, 2016, would give employers six months to comply after the rule’s final publication. This is compared with the 60 day period proposed in 2015 by the Labor Department. The initial proposal also called for annual revisions as opposed to the final ruling of every three years.

Response was so good for the first seminar we put on, Time & Pay will again be working with SESCO to offer another 1 hour tele-seminar on this  new rule on June 21, 2016 at 2: to 3:00pm. We encourage you to learn more about this free seminar

The Advi$or also reminds you that now it is even more important to have a good system to track and verify hours worked for hourly and salary employees. Time & Pay’s automated time & attendance system (ATA) is one of the most cost-effective, full featured systems that will help you to control and define your labor costs and verify to the Dept of Labor that you are in compliance with these new OT regulations. Contact us if you would like more information.


About Time & Pay:

Time & Pay is a professional payroll service provider located in Johnson City, TN. We service businesses of all sizes and types throughout the United States. Founded in 1992, Time & Pay provides businesses with complete payroll services , guaranteed payroll tax compliance, automated time and attendance systems and services, pay-as-you-go worker’s comphuman resource management systems and services, and more. We provide our customers with the cost effective tools you need to better manage your payroll, your employees and your business. Time & Pay’s services guarantee you will save money, time and aggravation and we back them up with the customer service you expect and deserve. Contact Us today to learn why business owners throughout the country are saying:

“Time & Pay! Why would you do payroll and timekeeping any other way?”

Payroll Services  in Kingsport, TNBristol, TNJohnson City, TN;   423-854-9042
Payroll Services in  Morristown, Greenville, Knoxville, TN   423-957-9505
Payroll Services in Cleveland, Chattanooga, TN  423-794-7855
Payroll Services in Newport News, VA   757-240-2766