Fair Labor Standards Act (FLSA) Overtime Exemption Regulation
Updated as April 20,2017
In May 2016, the Department of Labor revised the Fair Labor Standards Act (FLSA) requiring organizations to review position classifications to determine overtime eligibility. At that time, Human Resources completed a review of exempt-level positions and classified each position according to the FLSA requirements. Based on the final determination some positions were reclassified and became eligible for overtime effective November 12, 2016.
On November 22, 2016, a U.S. district court judge from Texas issued a preliminary injunction postponing the effective date of the overtime rule. Despite the court ruling halting the FLSA changes, Murray State University maintained the course of action that went into effect November 12, 2016. The University has continued to closely monitor the issue while awaiting the court’s final decision.
In the recent months, the future of the final rule has been increasingly uncertain; many available resources have found that a final ruling is unlikely any time in the near future. While awaiting the final rule, Murray State University has made the decision to set an institutional salary threshold of $30,000 for exempt positions. The threshold takes into consideration the rate of inflation since the last official Department of Labor salary threshold update in 2004.
Per the FLSA requirements, a position must meet both the salary threshold and the duties test to be considered exempt from overtime eligibility. Effective July 1, 2017 positions that meet both the institutional threshold and the FLSA duties test will be reclassified from non-exempt to exempt.
FLSA Overtime Impact to Murray State University
FLSA Overtime Phases
The Fair Labor Standards Act (FLSA) is a federal law that governs whether employees are eligible to receive overtime pay. Revisions to the FLSA have been anticipated for some time, and the Department of Labor released its final rule on May 18, 2016, revising the overtime exemption regulations. As a result, some staff positions that are currently classified as exempt from overtime will need to be reclassified as nonexempt under the new regulations. Employers must be in compliance with these changes by December 1 of this year.
One of the most significant changes required by the new regulations is the increase in the salary threshold that must be met for a position to be classified as exempt from overtime, The current threshold of $23,660 will be increased to $47,476 on December 1, 2016, which will mean employees whose annual salary is less than $47,476 may become eligible for overtime. Job duties also have to be considered, in addition to the salary limit.
Human Resources has a project team that is charged with managing this implementation, including campus-wide information sessions.
Manager Training Sessions
Manager Training FLSA Information Session Presentation
Information and Training Sessions