Expert advises non-profits to brace for new overtime rules with proper employee classification

Expert advises non-profits to brace for new overtime rules with proper employee classification

Expert advises non-profits to brace for new overtime rules with proper employee classification Non-profit organizations need to sit up and take notice of the new federal rules governing overtime labor “based on permitted reasons, and not on the desire to avoid tracking employee time and paying eligible staff overtime,” said Non Profit Risk Management Center executive director Melanie Herman in a recent report.

To determine classification under the new labor rules, she advised that organizations need to determine whether the position of each employee meets the duties and salary level test.
According to the Fair Labor Standards Act, a position paid more than $913 per week on a salary basis is exempt from the new overtime regulation beginning December 1 of this year. Prior to the enactment of the law, the exemption threshold was much lower at $455 per week.


The US Department of Labor provides further details on this rule in a fact sheet on the Overtime Final Rule and a guidance document for nonprofit organizations.

As for further exemptions, the labor department details executive, administrative, professional, technical and creative categories, among others. These rules are outlined in further detail in the Wage and Hour Division website (www.wagehour.dol.gov).

“Proper employee classification may seem a daunting task, but your mission-driven employees deserve to be classified and paid correctly. Don’t spoil the lifeblood of your nonprofit with stinginess or hesitation. Resolve to review and — if needed — reclassify your employees immediately,” Herman concluded.