OHR WebThe proposed overtime rule is a work in progress; however, it can have sweeping ramifications for businesses of all types and sizes. To truly understand how the overtime rule can impact labor costs, businesses can conduct an audit of exempt and nonexempt positions and determine how to handle the employees that are below the proposed threshold or whether reclassifying positions is a prudent decision.

As indicated in “Contingency Planning Urged for Proposed Overtime Rule,” posted by Allen Smith on SHRM.org, although the rules have not been finalized, it’s not too early to begin planning business changes so that you are prepared when it’s time to comply with the proposed overtime rule changes. Start by evaluating the employees that fall in the salary range of $23,000 to $50,000 and whether they meet the criteria for exempt or nonexempt positions. Alex Passantino, an attorney with Seyfarth Shaw and former acting administrator of the Wage and Hour Division, offers these key consideration points: 

  • Do employee positions meet the current duties test?
  • Should you raise employee pay to achieve the new salary level or pay the employees overtime?
  • Should employees above and below the proposed salary levels stay at the same classification?

Answering these questions can begin to outline the potential financial impact of the proposed overtime rule. You certainly don’t want to be blindsided with unforeseen financial changes so planning ahead, even with the proposed rule estimates, can provide valuable insight.

Businesses using Microsoft Dynamics® GP Payroll can add the Overtime Hours Rules add-on solution to streamline the calculation of overtime hours. You can create your own overtime rules to accommodate specific requirements for the employee, position, department, or rules unique to certain states. Manage rules based on day, week, pay period, or a combination of variables. Once these rules are set, Overtime Hours Rules will automatically calculate overtime hours during payroll without any additional steps. In addition, this solution will support compliance with Microsoft Dynamics® GP overtime rate calculations for the Fair Labor and Standards Act’s proposed overtime rules as well as other state requirements.

Start preparing for the proposed overtime rules by considering your employees’ status, the potential financial impact of the proposed salary changes, and by deploying the technology that can streamline compliance. Contact Integrity Data for more information about the Overtime Hours Rules add-on and other powerful payroll solutions.

By Integrity Data, Illinois Microsoft Dynamics GP ISV developing enhancements for Payroll and HR