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Overtime Exemption Regulations Explained to Small Business Leaders

Recently, small business leaders attended a debriefing session hosted by the Detroit Regional Chamber and longtime Chamber member, Dykema. The event was led by attorneys Robert Boonin and James Hermon.

In May, the U.S. Department of Labor (DOL) published its new regulations, which impact more than 4.2 million employees throughout the United States. By redefining the minimum salary thresholds for overtime exemptions under the Fair Labor Standards Act (FLSA), the regulations change the way employers must compensate their employees. Employers now have until Dec. 1 to make the necessary adjustments and become compliant with these new standards. The new regulations pose a potential hurdle for small businesses with concern to potentially increased payroll and balanced scheduling.

“It is time for us to roll up our sleeves and figure out what we have to do now that the new regulations are here,” Boonin said, addressing more than 40 small business leaders. “The truth is, despite increased pressure there are a number of options that businesses can take to navigate and become compliant within the new regulations.”

Dykema provided numerous options to minimize the regulations’ adverse effects on businesses in the region and provided attendees with a how-to plan to better position their business for success.

Suggestions to prepare for the regulations include:

1. Establish a plan and goals
2. Gather salary data for impacted positions
3. Assess data for gap analysis
4. Collect and analyze documents, including job descriptions and other job related documents
5. Conduct exempt status audit
6. Draft job content summaries, including description of duties based on audit
7. Deliver preliminary findings regarding classification assessments
8. Finalize classifications with business stakeholders
9. Communicate, implement and train; work business leaders

For more information, view the attached presentation and state-by-state wage and hour law summary guide.