It has been over a week since a federal District Court Judge issued an injunction staying the implementation of the new overtime rule (click here for more information on the injunction), and it does not appear that the U.S. Department of Labor is going to try to have the injunction overturned on appeal, at least anytime soon. So employers will not have to comply with the new overtime rule that was set to go into effect tomorrow, December 1. However, that only relieves employers from having to pay their employees who they want to treat as exempt from the overtime pay requirements of the Fair Labor Standards Act (“FLSA”) under the administrative, executive, or professional exemptions a minimum salary of $913 a week, or $47,476 a year. Employers will still have to pay their employees overtime for any hours they work in excess of 40 in any one work week, unless they qualify for one of the exemptions referred to above or another exemption. (Click here for a post that discusses those exemptions and others as they may apply to employees of insurance agencies.)
In determining whether the 40 hour threshold has been exceeded in any one work week, agency owners need to be aware of what is work time that must be included in making that determination. The FLSA does not require an employer to give an employee any time off during the workday for any reason, even to eat. It only requires that an employee be paid at least the minimum wage for all the time they are working and overtime pay if they work more than 40 hours in any one work week. If an employer decides to give its employees a break from work, that break must be at least 30 minutes long and the employee must not be required to do any work during the break period before that time can be excluded from work time for which the employee must be paid. With respect to breaks given so an employee may eat a meal, what this means is that an employee must not be on call or perform any other work related duties during the break. If they do, they must be paid for that time, too.
For agency employees who are licensed or have another certification that they must have to perform their duties, any time taken by such an employee for the purpose of attending a class, a webinar, or any other event to obtain or keep their license or other certification is considered work time for which they must be paid. The same thing is true for any class or other event an employee attends at the request of the agency. If the agency owner does not want to have to pay overtime to a nonexempt employee in this situation, any such class or other event should be attended during the employee’s normal working hours.
If an employee attends such a class or other event outside of their normal working hours, the agency owner must also be aware of the FLSA’s rules regarding payment for time spent traveling by employees. These rules are complex, but a good explanation of the basics, as well as other situations that may require payment, can be found here.
While the pressure is off for now on compliance with the new overtime rule, the existing rules still apply and can create problems for an agency that is not aware of what those rules require.