"proposed" new DOL regulations for exempt/nonexempt

HR in Okla

I have received newsletters with information about proposed changes in FSLA that say this is a proposal with several steps to go before it is approved and law. But then I received info about an audio conference that say "Monday, March 31 the US DOL Wage and Hour Division published SWEEPING new revisions..."

Which is it, a proposal? or a done deal?

Any one have more information?

Happy weekend.

POPEYE

From what I understand, the "PROPOSAL" has been sent to selected companies for review and comment. These comments will then be evaluated (yea right) and taken under advisement before it becomes law. If my memory serves me right, the law has not been amended since sometime in the 70's so it is about time. There are changes in salary $$ requirements, and in all three other test areas,
administration, executive and learned professional.

JKlink

I've found a good comparison chart on the proposed changes at [url]www.dol.gov/_[/url] sec/media/speeches/541_side_by_side

Leslie

I can't get to this site...the error message says the 541_side_by_side doesn't exist. You didn't happen to print it did you?

Cindy Hanna

I am getting the same error.

System

HR in Okla:
Greetings from California -- where employment law gets really confusing. I am the editor of the California Employment Law Letter and an attorney from my firm -- Ogletree Deakins -- will be participating in the audioconference you referenced in your note.
Actually, the new 541 Regulations are both a "proposal" and a "sweeping change in the law". Since these are regulations drafted by a federal agency, as opposed to a law passed by Congress, the Department of Labor (DOL) is required to publish their proposal before they take effect and provide for a period of time for ANY interested party to comment. The 541 Regulations were published in the Federal Register on March 31 with a 90 day public comment period. After that period closes, the DOL will review the comments and make any changes believed necessary to the regulations. The DOL is not expected to make significant changes to the 541 Regulations. After that process has been completed, the final regulations will be issued. This is expected to occur by December of this year.
Given the attention that has been generated by these new regulations -- and the dramatic impact they will have on classifying workers as exempt or nonexempt -- I believe that this is a critical topic for all HR professionals.
Joe Beachboard

HR in Okla

Thank you for the information, which is about what I thought. So this is not a done deal yet, but is expected to go into effect with little or no change.

Since it is not effective yet, I will wait for further information before using the new rules for decision making. My question was precipitated by a position change for an exempt employee to a position that has been non-exempt. She didn't want to give up exempt status because of additional benefits offered to exempt positions. I was hoping the new guidelines might offer some clearer direction.

crawfod

Dear "HR in Okla", would you mind sharing what additional benefits for exempt employees you are referring to? In my opinion, even if an employee wants to be considered exempt, perhaps due to the benefits you are referring to, you will not be protected from a future claim by that same employee now saying they were not qualified to be exempt and now want to be paid the overtime they missed out on. I doubt even a signed waiver would help. To me this is an employer's call, and when in doubt make them non-exempt and pay them overtime. It's the safer route. But the employee's supervisor still can control the overtime, in a lot of instances, with good management techniques, which keeps costs down which ultimately is a key goal anyway.

HR in Okla

The issues with this particular person are Long Term Disability insurance and a higher rate of vacation accrual for exempt staff. Our problem with her is keeping her at work, not with abuse of overtime.

I classified the position as non-exempt over her protests. Just would be interesting to see if the new guidelines would make any difference.

crawfod

Don't mean to wear you out on this, but I am interested in how your LTD benefits and vacation accrual benefits are set up differently for exempt employees. If you prefer to email me directly instead of using the forum, my email address is [email]crawfod@bellsouth.net[/email].
If you felt her duties now fit a non-exempt status, I would be surprised if the new changes will affect that decision. One proposal is to increase the minimum salary for white collar exempt employees to $425 a week ($10.63 per hour)which they estimate will cause approximately 1.3 million workers to be ineligible for exempt status. The regulations would also allow employers to suspend exempt employees without pay for disciplinary reasons in one-day increments, instead of the current rule that says suspensions can't be less than a week.

Rockie

I think the point here is that it doesn't matter how the employee "wants" to be classified, we have to follow the guidelines on this. Many employees do not want to give up what they perceive as "perks" of being exempt. Not having to punch a clock is one of them and also many companies give a higher level of vacation, etc. to exempt employees, particularly if they are expected to work a lot of extra hours. I have heard many times that a supervisory type of person wants to "step down" into a lesser level, but they don't "want" to lose their exempt status. This same employee also wants overtime when they work over 40 hours in a week, but also wants to be free to come and go as they please without punching a clock. Sorry, folks....can't have it both ways!

HR in Okla

I agree. Thanks for the input. I got some additional info. on this subject from BLR who had a link to the DOL website. Seems the salary level is an issue for many positions. The one I was looking at is paid high enough to quality.

Gracie

This is not a done deal. According to info I pulled from the SHRM homepage, staff reports highlighted that the proposal was published in the Federal Register on 3/31/2003 and DOL will issue final revised regulations next winter.

There are generally 5 new proposed guidelines, one of which states:

- make exempt from overtime pay employees who supervises two or more workers, have authority to hire and fire, or have an advanced degree or specialised training. Employees making more than $65,000 and performing at least one exempt duty is exempt.

I have a question regarding the above guideline, would having an advanced degree or specialized training alone make an employee exempt?

Pork

HR in OK: It is still a proposal and on Thursday I got a copy of the proposal and I submitted my thoughts. I support the changes, but made comments on areas of considration pertaining to the subject on the deffination pertaining to PROFESSIONALS. It appeared to me that the proposal would write out the opportunity to consider a CDL "over-the-road driver" as a professional by defination. Which should that happen we employers with over-the-road drivers would have put all drivers on the FLSA NON-EXEMPT CATEGORY. For some in our situation, the words would cause us to consider the time clock and overtime provisions rather than a per load method of compensating our drivers for their work! We much perferred the EXEMPT status for our professional drivers.

Additionally, we are an agricultural corporation and were
EXEMPT from the law; but now it reads in contradiction to words in different sections and paragraphs as no longer will be EXEMPT from the FLSA. I asked that DOL spell it out other wise I and other HRs will have a difficult time explaining to our leadership that "Hey, why we were asleep and planting our fields or growing our "piglets" and fish and turkey and sheep, chickens, and cattle, and all consumables, they Fed's made us subject to all provisions of the FLSA whether we wanted to use or not to use FLSA or not.

Pork

Leslie

Where is this darn proposal? I have yet been able to get hold of a copy!

HR in Okla

I'd like to get hold of the full proposal. I'm not sure what I got from DOL is anything but a synopsis. It was a good comparison between the current guidelines and the proposed one, but I'd like more specific direction as to the meaning of "holds a position of responsibility." If most positions didn't have some degree of responsiblity, how could we justify filling them?

Brad Forrister

A helpful comparison of the principal changes is at:

[url]http://www.dol.gov/_sec/media/speeches/541_Side_By_Side.htm[/url]

The full text of the regs can be found at:

[url]http://www.dol.gov/esa/regs/fedreg/proposed/main.htm[/url]

Brad Forrister
Director of Publishing
M. Lee Smith Publishers

jampc

Thanks Brad for the link to the side by side comparison of the existing and propoesd changes. Appreciated.

Leslie

Thanks Brad - I finally found it!