Beacon Transcript – This December will be coming with new overtime rules as the federal regulations in the domain have been changed in a move which will most definitely lead to changes.
The new overtime pay rules will go into effect starting with December 1 and are estimated to target approximately four million American residents.
According to White House statements, new rules had to be adopted as the classical 40-hours work week is no longer respected.
The statement maintains that the previous system is not being followed as more workers are putting in more hours, but are not getting paid for them.
A new law will be introduced so as to counter this fact, rule that will be known as the Fair Labor Standards Act.
At the moment, full-time workers that make around $23,660 or less should be compensated for their hours spent working overtime.
However, employers can skip and avoid the overtime compensation by classifying the respective workers as “exempt”.
The new Fair Labor Standards Act will not only change the minimum wage rate, it will also change some rules and cut back on these types of exceptions.
As such, the $23,66 exempt” will no longer be a valid reason for the employers so as to avoid paying overtime.
The new overtime rules will also be changing the salary limit from the current $23,000 to $47,500. This will mean that salaried workers that make less than the latter sum will now be eligible for over program compensations.
Another change to be introduced by the new laws will be the progressive updating of the maximum salary limit.
From now on, the wage threshold will be changed and updated after every three years in an effort to keep it up to date.
As such, analyses and estimates predict that the next rise, which will come into effect by January 1, 2020, will most probably come to a $51,000 threshold.
As the new law will imply that only workers that make $47,476 or more can become exempt from being paid for their overtime, analysts predict a number of changes.
The market is expecting a number of changes come December as employers will be trying to make up for the new overtime rules.
One of the changes may be a raise in salaries so as to reach the new limit and make workers once again exempt from being paid for the overtime.
Another could be the employers’ refusal to pay overtime hours in general and yet another one would be the hiring of part-time workers.
The new laws will probably imply new methods of keeping track of the working hours. They may also necessitate new records and training, for both employee and employer.
As the new overtime laws could come to be beneficiary for some, it may unfortunately also lead to cutoffs or salary reductions. This measures may be taken as companies will be trying to make up for the employment costs.
Although the full impact of the Fair Labor Standards Act is yet to be determined, this December will most probably be bringing changes.
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