As the year comes to a close, it’s important to note that on November 6, 2017 the 5th U.S. Circuit Court of Appeals granted motion to the Department of Labor (DOL), to halt litigation over the 2016 overtime rule. This motion makes it unlikely that the 2016 overtime rule will ever take effect. If you recall in November 2016, the minimum salary level threshold for overtime and exempt status would have been raised to $47,476 per year, impacting more that 4-million people.
Below are 2 updates from the recent ruling:
- No Ambiguity: “The DOL wants to preserve its right to have the 5th Circuit decide that it has the authority to set whatever salary level it ultimately selects…potentially removing a precedent that could serve as a basis for challenging the next overtime rule the department issues.”[i]
- New Rulemaking: When the DOL under the current administration issues a new rule, it can seek to have the current appeal dismissed and the court’s decision vacated. The focus currently is on a new rule that incorporates a more modest increase in the salary threshold.
The rule making process is scheduled to begin in July 2018. Remember, this is a federal law; state specific laws can vary on exempt and non-exempt status. In New York State, we have laws that impact Executive and Administrative Classifications and overtime exemption level thresholds, based on the location throughout the state. These rates will increase on January 1, 2018. Remember to review state and federal guidelines, to ensure legal compliance.
NY State Administrative Exemption Rates and Questions
NY State Executive Exemption Rates and Questions
Additionally, the minimum wage rate in New York State is scheduled to increase on December 31, 2017. This again is based on location. In Upstate New York, the rate increases from $9.70 to $10.40/per hour. The federal minimum wage has not been increased since 2009.
NY State Minimum Wage Rates and Information
Federal Minimum Wage Chart
If you are confused by the classifying positions and exemption changes in New York State, seek guidance and ask questions. Classifying positions can be complex. Do not assume when classifying positions as exempt or nonexempt. There have been multiple court rulings lately regarding mis-classification of positions as exempt.
[i] https://www.shrm.org/resourcesandtools/legal-and-compliance/employment-law/pages/overtime-rule-stay-granted.aspx
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Published by Mathew W. Burr, MJ-LEL, MBA, MHRIR, GPHR, SHRM-SCP, SPHR, CPHR
Matthew Burr has over eleven years of experience working in the human resources field, starting his career as an Industrial Relations Intern at Kennedy Valve Manufacturing to most recently founding and managing a human resource consulting company; Burr Consulting, LLC. Prior to founding the consulting firm, the majority of his career was spent in manufacturing and healthcare. He specializes in labor and employment law, conflict resolution, performance management, labor and employment relations. Matthew has a generalist background in HR and provides strategic HR services to his clients, focusing on small and medium sized organizations. He is a retired Assistant Professor of Business Management from Elmira College, an Adjunct Professor at Alfred State University and Collin College. Matthew is also the SHRM Certification Exam Instructor at the college, his students currently have an 80% pass rate on the SHRM-SCP and 92.3% pass rate on the SHRM-CP. Matthew works as a trainer Tompkins Cortland Community College, Corning Community College, Broome Community College and Penn State University. He also acts as an On-Call Mediator and Fact-Finder through the Public Employment Relations Board in New York State, working with public sector employers and labor unions.
Matthew has publications at the Cornell HR Review, Business Insider, New York State Bar Association, Expert 360 (in Australia). In early 2017, he published his first book, “$74,000 in 24 Months: How I killed my student loans (and you can too!).”
Matthew has an associate's degree in business administration from Tompkins Cortland Community College, a Bachelor of Science degree in business management from Elmira College, a master's degree from the University of Illinois School of Labor and Employment Relations in Human Resources & Industrial Relations and a Master’s in Business Administration specializing in entrepreneurship from Syracuse University. He currently holds a Lean Six Sigma Green Belt, Senior Professional in Human Resources (SPHR), Global Professional in Human Resources (GPHR) and the Society of Human Resource Management Senior Certified Professional (SHRM-SCP) certifications.
Matthew has been featured on CNN Money, Fast Company, Fits Small Business, Magnify Money, My Twin Tiers, Namely, Student Loan Hero, Smart Sheet and CEO Blog Nation.
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