Compliance Review of NSU Positions - New FLSA Overtime Rule

June 1, 2016

On May 18, 2016, the U.S. Department of Labor announced changes to the Fair Labor Standards Act (FLSA) impacting its rules on overtime pay.  The new law will become effective on December 1, 2016.   

The changes, affecting 4.2 million workers nation-wide, requires employers to re-evaluate the exempt/non-exempt status of their employees due to the increase the minimum salary threshold for the overtime exemption from $23,660 to $47,476 per year.  The law does not automatically change overtime eligibility or require employers to increase salaries to the new exemption threshold.  Rather, employers are encouraged to audit current exempt and non-exempt positions to determine the proper classification under the new law and make whatever adjustments are necessary to achieve compliance.

Preliminary analysis conducted by the Compensation Department in the Office of Human Resources (OHR) is complete and approximately 700 NSU positions will be reevaluated for exemption status.  Meetings are underway with the Colleges, administrative units and OHR/Compensation to discuss the affected positions.  When the reevaluations are completed OHR/Compensation will assess the impact on our workforce and model compliance strategies from which a solution that best meets the University's operational and budgetary needs will be determined.

In order to comply with the new law, it is expected that reclassification of some (but not all) of the 700 positions from exempt (not eligible for overtime pay) to non-exempt (eligible for overtime pay after 40 hours worked in a workweek) status will be required.

Important Dates

Date Action
June-August Review Classifications with Deans and VPs
September Present Recommendations to Senior Management
Early November Notify employees of Classification Changes
November 19, 2016 NSU Effective Date of Classification Changes

Frequently Asked Questions

A:  The Fair Labor Standards Act (FLSA) requires that employees in the United States be paid overtime pay at 1 ½ times the regular rate of pay for all hours worked over 40 hours in a workweek. However, it does allow for certain "exemptions" from overtime pay requirements for employees based on specific job duties and salary.

A:  The Department of Labor is changing the criteria used to establish a position as “exempt” from overtime requirements under FLSA effective December 1, 2016.

A:  In order to ensure the University is in compliance with the new regulation, it is necessary   to reevaluate the exempt positions that are paid less than $47,476 annually.  The law may also require reclassification of some NSU positions from exempt to non-exempt.

A:  These terms are employment status classifications established by the FLSA and used by employers primarily to designate   which positions are   subject to the Federal minimum wage and overtime requirements.  “Non-exempt” employees are required to track hours worked to determine their pay.  “Exempt” employees typically receive their full salary every pay period.

A:  If your position is non-exempt, it means that you are eligible to be paid overtime (at the rate of 1 ½ times your regular hourly pay rate) for any hours worked in excess of 40 hours each week.  Because NSU operates on a 37 ½ hour week, a non-exempt NSU employee would receive overtime after he/she worked more than 40 hours in a work week. 

A:  It means that your position is exempt from the provision requiring payment for time worked in excess of 40 hours in a work week.

A:  NSU defines its work week as beginning on Saturday and ending on Friday. 

A:  No.  Most employees will not be affected by the changes this year.

A:  Affected employees and their supervisors will receive targeted communications.  Since compliance is required by December 1, 2016, required changes must be made by November 19, 2016.   Therefore, communication will occur in early November.

A:  Those affected will record their time worked so that the university can calculate over-time pay as required.  At NSU SharkTime, or Kronos, is used to record time worked.   Up to 40 hours a week will be paid at the usual hourly rate.  Time worked above 40 hours a week will be paid at the overtime rate of 1 ½ times the normal hourly rate.

A:  No.

A:  By dividing current salary by the standard number of hours worked annually (usually 37.5 to 40 times 52 weeks).

A:  The FLSA changes do not affect your retirement, health insurance or tuition benefits.  Working with senior management, the Office of Human Resources will develop solutions to otherwise ensure the change will have a minimum impact on employees.

A:  Yes.  Prior authorization from your manager or other senior management must be obtained before any overtime can be worked.

A:  You will be paid overtime earned.  However, repeated failure to receive prior authorization may result in disciplinary actions, up to and including termination.

A:  No.  Such arrangements are sometimes referred to as compensatory time off (or “comp time”), and are only allowed for federal employees.  However, you and your manager can agree to rearrange your daily hours within the same work week.

A:  If you are required to remain on site while on call, then the time counts as time worked and you will be compensated.  If you are called into work while on call, travel time to and from home, and all work time is counted as time worked.  If you are required to remain on call at home, or if you are allowed to leave a number where you can be reached, this time is not considered time worked and will not be compensated.

A:  Rules around when and if travel time counts as time worked are complicated, so you should speak with your supervisor if you have questions, but here are some guidelines to a few of the most common situations:

  • Traveling from home to your regular place of business and back home again around regular business hours is not considered work time.
  • Traveling as part of your principal activity, such as travel between offices or campuses, is considered work time.
  • Travel time that keeps you away from home overnight:
    • is considered work time when travel occurs during your usual work schedule;
    • is also considered work time when occurring during your usual daily work schedule on non-working days.
  • Time spent in travel away from home outside of your usual work schedule as a passenger on an airplane, train, boat, bus, or automobile is generally not considered work time.

A:  If you are non-exempt, you must record all time worked in SharkTime (Kronos).

A:  Any required corrections should be reported via email to your supervisor immediately so that he or she can correct your time card.  If the payroll deadline has passed for that pay period, the correction(s) will be reflected in the following regularly scheduled pay check.  Payroll management will not produce off-cycle checks for any hours missed, so it is very important to record your time daily.

A:  No. If you are non-exempt, then you may NOT work “off the clock”.  Federal law and NSU policy require that you record all time worked to ensure that you are properly paid.

A:  No.  Your performance goals will not change as a result of reclassification.

A:  Your experience, credentials, and performance record haven’t changed, and these are the most important criteria being considered when you apply for another position.