IMPORTANT UPDATE: A judge recently blocked the new federal overtime rule. We’ll keep you updated as the news unfolds.
Beginning December 1st, 2016, a new federal overtime policy will change the salary threshold of exempt employees from $415 a week to $913 a week. The new policy will affect up to four million employees in the United States, potentially making them eligible for overtime pay as designated by both state and federal laws.
The policy may also change the way many small businesses handle employee wages and hours — whether they decide to change the salaries of their employees or keep working hours at or below 40 a week.
Before making a decision on how you want to proceed, it’s important to have a full understanding of the ruling, starting at the requirements for defining exempt and non-exempt employees.
In a few minutes, this video will help give you a cursory understanding of exempt and non-exempt employees as defined by the Fair Labor Standards Act, or FLSA.
In particular, this video will cover:
- A short overview of the FLSA
- Common “white collar” exemptions for employees
- Job duties, salary basis, and salary level tests
- A review and summary of the three tests, plus exempt vs non-exempt
- Where to find more resources and help
Explain the basics of exempt and non-exempt employees with this visual guide.
Looking for more information? We have other related articles that will help illuminate the ruling:
- Fair Labor Standards Act (FLSA): Everything You Need to Know
- A Simple Guide to Exempt vs Non-Exempt Employees
- What You Need to Know About the New Federal Overtime Ruling
This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, legal or tax advice. If you have any legal or tax questions regarding this content or related issues, then you should consult with your professional legal or tax advisor.