You are here:

Proposed Changes to FLSA Laws Close to Implementation

Posted Mar 17, 2016 02:25 PM
In mid-March 2016, the Department of Labor sent to the Office of Management and Budget its final changes to the federal Fair Labor Standards Act laws, which determines which workers are eligible to receive overtime pay. The proposed changes would especially impact nonprofits where managers are also engaged in delivering direct services or where employees work longer hours during part of the year like summer camps.

Please visit our update to this blog post with new tools and additional information.

In a previous blog post, we talked about proposed changes being considered by the Department of Labor (DOL) to the federal Fair Labor Standards Act (FLSA) regarding overtime pay for exempt staff members.

Earlier this week the DOL sent to the Office of Management and Budget (OMB) its final changes for determining which workers are eligible for receiving overtime pay. The proposed change will more than double the minimum salary level at which a staff member is exempt from overtime from $455 to $970/week, or $50,440 per year.

However, this change could adversely impact the staffing landscape of many nonprofits across the country. Organizations that work with vulnerable populations, persons with disabilities, troubled youth, and people with unique healthcare needs will be affected most due to the fact many of these nonprofits employ staff who work long hours in any given week to help meet the needs of their constituents.

There are fears within these organizations that if these new FLSA changes are implemented, it may force them to limit the level of care they provide their clients or force them to hire more part-time workers who cannot offer the continuity of care desired by these nonprofits. Nonprofits may also struggle financially to adequately pay their employees and might have to open a line of credit in order to continue their operations uninterrupted.

Right now, there will be a review period which could take as little as four to six weeks or as long as several months. The law could take effect within 60 days of publication in the Federal Register. The content of the final rule will not be known until publication.

The Obama administration has until May 16 for the new rules to be released by the OMB, a deadline that seems well within reach. If the current Congress doesn’t consider the rule, the next president and Congress may.

Read more about the specific proposals that were sent to the OMB.