Frequently Asked Questions
What is the Fair Labor Standards Act (FLSA)?The FLSA establishes minimum wage, overtime pay, recordkeeping, and youth employment standards affecting all United States employees in the private sector and in Federal, State, and local governments, including Higher Education. Employees are either “exempt from overtime” or “non-exempt from overtime” pay based on FLSA regulations. The U.S. Department of Labor (DOL) administers the FLSA regulations.
What are the current FLSA Regulations?Under the current regulations, a position must satisfy three criteria to qualify as exempt from overtime:
- The incumbent in the position must be paid on a salaried basis (the salary basis test);
- The salary must be at least $684 per week or $35,568 annually (the minimum salary requirement or salary threshold); and
- The position’s “primary duties” must be consistent with executive, professional, administrative, and computer related positions as defined by DOL (the primary duties test).
Are faculty members or coaches impacted?Teaching faculty will not be impacted. Teaching faculty are FLSA exempt, regardless of their annual/weekly salary, if their "primary duty is teaching, tutoring, instructing, or lecturing in the activity of imparting knowledge." Typically coaches also qualify as FLSA exempt under this "teaching exemption" and will not be affected by the changes.
What are the current proposed FLSA Regulations?The DOL published its proposed regulations in August 2023. The proposal does not include any changes to the salary basis test or duties test. However, the DOL has proposed increasing the minimum salary threshold for exemptions from overtime pay requirements for executive, administrative, professional, and computer related positions from $684 per week ($35,568 per year) to $1,059 per week ($55,068 per year) — a nearly 55% increase.
The last time the salary threshold was discussed in 2016, it took years for it to change. Will it really change this time?In March, the DOL’s Wage and Hour Division (WHD) sent the final rule to update FLSA overtime regulations to the Office of Information and Regulatory Affairs (OIRA) for review. This is a required step in the regulatory process and acts as one of the last steps prior to releasing the text of the regulation to the public.
OIRA is required to review all proposed and final rules, as well as all regulatory actions, before implementation. OIRA has 90 days to conduct its review. This means the final rule as written or updated could be released as early as April, which would meet the DOL’s target date for release.
What does it mean to be exempt or non-exempt?Exempt (salaried) employees are excluded from receiving overtime pay. Non-exempt (hourly) employees are required to be paid overtime (at a rate of one and one-half times their regular rate of pay) for any hours worked in excess of forty hours in a seven-day workweek as defined by their employer.
At OHIO, the majority of Administrative and Professional, Executive, and Faculty positions fall under the FLSA exempt category.
How do I determine if I’m an exempt or non-exempt Ohio University employee? At Ohio University, exempt employees are paid semi-monthly and do not report time worked in Workforce, our time keeping system. Non-exempt employees are paid on a biweekly basis and enter hours worked into the Workforce timekeeping system.
When are the new regulations going to take effect?The timeline for implementation of any changes announced by the DOL in April is uncertain at this point but would be no less than 90 days from the date of the announcement. The earliest potential implementation for changes to University positions would be July 1, contingent upon the timing of the announcement and any revisions to the DOL proposal.
How do I know if I am impacted by the proposed change?If an employee currently "salaried" is earning below the new threshold amount, they may be affected by the changes. University Human Resources will notify impacted employees once the DOL has issued its final guidance and timeline, and the University has reviewed the implications.
If I am impacted by this change, will my pay schedule change?Impacted employees will switch from a semi-monthly to a bi-weekly pay schedule.
What is the difference between biweekly and semi-monthly pay?Biweekly pay means employees are paid every two weeks, typically resulting in 26 pay periods per year. Semi-monthly pay means employees are paid twice a month, usually on specific dates such as the 15th and the last day of each month, resulting in 24 pay periods per year.
Will employee benefits change for positions that are reclassified to non-exempt?Employees whose positions are reclassified to non-exempt will change to the appropriate leave accrual schedule. However, the annual accrual rates will not change.
What else will be impacted by this change for positions that are reclassified to non-exempt?
- Time Reporting: Non-exempt employees record all hours worked in WorkForce on a biweekly schedule. Applicable compensatory or overtime hours are recorded and paid accordingly.
- Overtime for Non-exempt employees: Non-exempt employees must record all hours worked, including overtime hours, and will receive additional pay for overtime. All overtime must be pre-approved by your supervisor.
How and when will affected employees be notified of any changes?With the anticipated changes to the eligibility criteria, an analysis is being conducted to determine the positions which may be potentially impacted by the updated compliance standards. When new guidance is finalized, Human Resources will work with University departments with exempt administrative employees earning less than the new FLSA salary threshold to determine next steps on a case-by-case basis. Thereafter, the results will be communicated to the impacted employees.
If I am an employee with a salary under the new threshold, do I have the option of remaining exempt?No. The FLSA is a federal law. The determination of an employee’s FLSA status is governed by the requirements of the federal law – it is not an employee choice. It is at the discretion of the organization with regard to each individual’s compensation, position responsibilities, position exemption status for positions with same or similar titles, and the new regulation. In order to be exempt from FLSA provisions (not eligible for overtime), employees must pass both the duties test and salary tests. If you do not pass these tests, you must be paid for overtime hours worked under the law. Exempt employees must also be paid on a salary, not hourly, basis.
When will we know more about the proposed changes?We can stay informed about the proposed changes by monitoring official announcements from the US Department of Labor and related regulatory bodies. Additionally, OHIO will provide updates and guidance as more information becomes available.
Where can I get more information?
Complete information on the new rule is available from the Department of Labor’s Wage and Hour Division
. Please contact Human Resources at 740-593-1636 or by email at UHR@ohio.edu
. FAQs will continue to be updated as we learn more.