Article | October 13, 2016

Employees Newly Eligible for Overtime

Source: RSPA
Bob Goldberg

By Bob Goldberg, RSPA General Counsel

Overtime compensation has long been an issue for resellers. Questions regarding technician hours, travel time, training, comp time, and company functions often arise. Recent changes to the overtime rules require every reseller review job descriptions, compensation levels, and time keeping procedures.

Eligibility for overtime compensation is determined by job duties and compensation and the fact an employee is paid a salary is not a factor. It is essential employees be required to keep accurate records of their time, on a daily basis, according to company requirements. On December 1, 2016, the Department of Labor, pursuant to the Fair Labor Standards Act, will increase the minimum amount of compensation required to eliminate automatic eligibility for overtime compensation. The current administration in Washington, D.C. was not able to raise the minimum wage on a national level and thus turned its focus to raising compensation by a rulemaking overhaul of the Fair Labor Standards Act.

Beginning December 1, 2016, any employee earning less than $47,476 per year will be eligible for overtime compensation. On the other end of the spectrum, individuals earning more than $134,004 per year will be considered highly compensated individuals exempt from overtime compensation. Estimates range that from four to eight million additional individuals will become eligible for overtime compensation. The salary levels themselves are not dispositive of the issue.