THE NEW OVERTIME RULE
This planning should include making provisions for the overtime payment rules set to take effect on December 1, 2016. The new rule updates the salary and compensation levels for “executive, administrative,
and professional” workers who currently are ineligible to receive overtime pay for extended work (usually referred to as “exempt employees”). Here are the two key provisions:
1. The maximum compensation of employees exempt from
overtime (>40 hours/ week) rises
a) From $455/week, or $23,660/year salary,
b) To $913/week, or $47,476/year (the 40th percentile of earnings of FT salaried workers in the lowest-wage
Census Region -- the South); and
2. Automatic adjustments every three years to maintain
these percentiles.
These salary levels apply to all employees, regardless of one’s job title or
whether one is paid a salary or an hourly wage. Relevant to the readers
of this article, employees within the scope of the new salary rule include
those whose work “requires invention, imagination, originality, or talent
in a recognized field of artistic or creative endeavor.” Do you see yourself in that definition?
As with enforcement of the distinction between employees versus independent contractors, news of these minimum wage and overtime rules
has been available for more than a year. The Department of Labor published a “Notice of Proposed Rulemaking” in the Federal Register back
on July 6, 2015. Even if you didn’t notice that, more than 270,000 people
did and provided their comments. The “Final Rule,” which includes the
provisions described above, was published on May 18, 2016 to provide
time before the scheduled December 1 implementation date.
Every event and venue professional has dealt with people who, despite
all the signs and warnings, still act surprised when you insist on enforcing a rule -- this is no exception. On September 28, the U.S. House of
Representatives passed HR 6094, the “Regulatory Relief for Small Businesses, Schools and Nonprofits Act,” sponsored by Rep. Tim Walberg,
R-Mich. It would delay the implementation date to June 1, 2017, and
entirely remove the automatic three-year adjustment to minimum compensation levels.
Sports and entertainment lawyer Steven A. Adelman is the head of Adelman Law Group, PLLC in Scottsdale,
AZ and Vice President of the Event
Safety Alliance. He can be reached at
[email protected].
I doubt this bill will become law. In the unlikely event that the Senate
passes a similar bill during its post-election “lame duck” session, the
President, who proposed a wage increase back in 2014, is sure to veto
it. So, as above, plan accordingly.