The Fair Labor Standards Act (FLSA) final rule regarding requirements for overtime pay went into effect on July 1, and it likely impacted your clients. According to estimates from the DOL, it impacts more than a million exempt American workers that fall between the old and new thresholds. Learn more about the overtime rule and how timekeeping can keep your clients compliant.
What is the Final Rule?
The final rule outlines which employees qualify for overtime pay. In order to be exempt from receiving overtime pay for all hours worked over 40 during a workweek, an employee must meet the following requirements:
- Receive a salary (rather than be paid hourly)
- Meet a salary threshold (recently updated)
- Perform professional, administrative, or executive duties primarily (also known as the “white collar” exemption)
The final rule took effect on July 1, 2024. Now, all employees earning less than the minimum salary threshold are required to be paid at their overtime rate (time and a half) for all overtime hours.
As of July 1, the minimum salary threshold is $43,888 per year (or $844 per week). The previous threshold was $35,568 ($684 per week). There is also a planned increase on January 1, 2025, taking the threshold to $58,656 ($1,128 per week). It will then update automatically every three years based on wage data.
We covered the change earlier in the year. Review that post for additional detail.
You can also learn more about the final rule here.
Timekeeping and Managing Overtime
As mentioned, the first step for employers should be determining which employees are affected by the final rule. From there, consulting with a labor law expert to determine the best course of action is an important step.
If your clients have chosen to reclassify employees to earn an hourly wage, timekeeping is an absolute must. Tracking employee hours ensures accurate pay and ensures compliance with the laws established under the FLSA, among other labor regulations. Additionally, time-tracking supports transparency while maintaining employee responsibility.
Ensuring Compliance
Make sure your clients have access to the time and labor platform that makes tracking hours easier and more seamless. They can easily maintain compliance with legal requirements while ensuring payroll accuracy, automating the tasks associated with tracking employee hours.
Your clients can also utilize the mobile app for remote and on-the-go workers, or opt for a smart time clock that uses physical indicators (facial or fingertip scans) to record employee punches.
WorkforceHub does it all. Don’t let your clients be without it when they need to track employee time.
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