If you are currently using the fluctuating workweek that is permitted under the Fair Labor Standard Acts (FLSA) you may want to review that decision. The Fifth Circuit Court of Appeals has drawn some limits on that method. Bill Pokorny has done a fantastic blog on discussing this recent court case. Check it out for the latest if you are currently using this type of workweek or just want to increase your current knowledge in this area.
When conducting my webinars on the FLSA requirements one area always seems confusing to attendees and that is the eight types of payments that can be excluded when calculating regular rate of pay. The one found most often to be confusing to my attendees and maybe to you as well is the one that is for bona fide overtime premiums. Bill Pokorny has done an excellent blog post on this subject that I know you will find helpful on this topic. Please take the time to check it out if you offer this type of payment or to improve your general payroll knowledge.
On August 31st, the Judge in charge of the court case for the new OT rules initiated by President Obama issued its final ruling. Basically he sided with the plaintiffs. For an excellent recap of the ruling I am referring you to Bill Pokorny’s blog.
I recently had a discussion with an associate (also an payroll consultant) about the regular rate of pay and payroll systems in general. Unfortunately the question we both had, we could not fully answer. So I am turning to my blog followers to help me out. When I started in payroll we did payroll by hand, including the regular rate of pay calculations. Of course, systems have improved since 1977. But my question is…which current systems (whether in-house or service bureau) do regular rate of pay calculations? For example, I give a bonus to an employee for finishing a project on time (nondiscretionary bonus) and he earned it in the same week it was paid. For this scenario would your payroll system do the regular rate of pay calculation? Or would you have to do it by hand and add it in? Second example, an employee receives a monthly commission on sales (hourly employee). He is paid his commission on July 15th for the month of June. Would your system be able to recalculate the additional overtime due? Or would you have to do it by hand (Excel spreadsheet)?
If your system does not do the regular rate of pay calculation, did you know this when you bought the system or signed up for the service bureau?
I appreciate any input you might have on the subject. Please include the name of the system if you can do so. Also please note if you had to have a special program written to handle the calculations.
The latest on the salary increase was released today. The U.S. Department of Labor has today announced that it will publish a Request for Information (RFI), Defining and Delimiting the Exemptions for Executive, Administrative, Professional, Outside Sales and Computer Employees. The RFI offers the public the opportunity to provide information that will aid the Department in formulating a proposal to revise these regulations. The RFI solicits feedback on questions related to the salary level test, the duties test, inclusion of non-discretionary bonuses and incentive payments to satisfy a portion of the salary level, the salary test for highly compensated employees, and automatic updating of the salary level tests. The 60-day comment period for all issues raised in the RFI ends on September 25, 2017. The public may submit comments according to the instructions listed in the RFI as published in the Federal Register.
But the court case is still raging on. The DOL has decided to fight the ruling, not to defend the limits set by the Obama administration, but to defend the concept that the DOL has the right to change the salary limit. Lots of legal blogging on the topic so I wanted to include some of those blogs for you today:
The Department of Labor (DOL) has just announced that they will reinstate the issuance of opinion letters. The action allows the department’s Wage and Hour Division to use opinion letters as one of its methods for providing guidance to covered employers and employees. An opinion letter is an official, written opinion by the Wage and Hour Division of how a particular law applies in specific circumstances presented by an employer, employee or other entity requesting the opinion. The letters were a division practice for more than 70 years until being stopped and replaced by general guidance in 2010.
“Reinstating opinion letters will benefit employees and employers as they provide a means by which both can develop a clearer understanding of the Fair Labor Standards Act and other statutes,” said Secretary Acosta. “The U.S. Department of Labor is committed to helping employers and employees clearly understand their labor responsibilities so employers can concentrate on doing what they do best: growing their businesses and creating jobs.”
The division has established a web page where the public can see if existing agency guidance already addresses their questions or submit a request for an opinion letter. The web page explains what to include in the request, where to submit the request, and where to review existing guidance. The division will exercise discretion in determining which requests for opinion letters will be responded to, and the appropriate form of guidance to be issued.
California has long had a day of rest requirement. In fact it has existed long before overtime and minimum wage. It guarantees an employee “one day’s rest therefrom in seven”. But which employees and what exactly is one day in seven? This was really never litigated before the current case of Mendoza v. Nordstrom in which the ruling was just handed down on May 8th. Rather than my trying to explain the entire court case in a blog, I will, instead, urge you to read the recap of the case as presented by Sheppart Mullin Richter & Hampton’s Brian S. Fong for the Mondaq News Update Service. It is an in-depth look at the ruling and the impact on employers.
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