2016 OSHA Fines Increase

August 10, 2016

For the first time in over 25 years, the Occupational Safety and Health Administration (OSHA) is increasing monetary penalties for standards violations – in a big way. How much are fines increasing, and what could this mean for your business?

Minnesota Minimum  Wage Increased on Monday, August 1, 2016

August 10, 2016

Minnesota’s minimum wage increased to $9.50 per hour on Monday, August 1st for large employers and to $7.75 for small employers. A large employer is one with annual gross sales or business done in Minnesota of over $500,000. For more information see the Minnesota Department of Labor’s fact sheet .

Overtime Exemptions: Final Rule – Effective December 1, 2016

June 3, 2016

Effective December 1, 2016 rules for overtime pay for white-collar exempt employees are changing. Updates on these changes are outlined below.

Overtime Rule (or Final Rule)  

• Updates the salary level required for executive, administrative and professional exemption (white-collar exemptions)

• Employers are not required to pay minimum wages or overtime to these individuals provided they satisfy the salary level and other requirements to meet one of the white-collar exemptions.

• Salaried white-collar employees who are paid below the updated salary level are generally entitled to overtime pay.

• Duties tests that also affect the determination of who is exempt from overtime have not changed.

Overtime Rule – New Salary Level/Requirements

• $913.00 per week or $47,476 annually (previously $455.00 per week or $23,360 annually)

• $134,000 annually for highly compensated employees (previously $100,000)

• Salary and compensation levels will automatically update every three years (First Scheduled Update in 2020)

Assessment Process

Establish that a white-collar employee is exempt from requirements.  Three criteria must be met to be exempt from overtime requirements:

1. The employee must be paid on a salary basis not subject to reduction based on quality or quantity of work (rather than an hourly basis) = Salary Basis Test.

2. Salary must meet a minimum salary level (#2 above) = Salary Level Test.

3. Employee’s primary job duty must involve the type of work associated with Exempt Executive, Administrative, or Professional employees = Standard Duties Test.

Standard Duties Test – Professional, Administrative and Executive Exemptions

Professional Exemption

• There are many types of employees in this category. Examples: “creative” professionals, teachers, and employees practicing law or medicine.

• The employee must primarily perform work that requires advanced knowledge in a field of science or learning, usually obtained through a degree, or requires invention, imagination, originality or talent in a recognized field of artistic or creative endeavor.

Note: Requirements do not pertain to teachers, lawyers, or doctors.

Administrative Exemption

• Employee’s primary duty must be the performance of office or non-manual work directly related to the management or general business operations of the employer or employer’s customers.

• Employee’s primary duty must include the exercise of discretion and independent judgment with respect to matters of significance.

Executive Exemption

• An employee’s primary duty is managing the enterprise or managing a customarily recognized department or subdivision of the enterprise.

• Employee must customarily and regularly direct the work of at least two other full-time employees or their equivalent (80 FTE per week).

• Employee must have the authority to hire or fire other employees, or the employee’s suggestions and recommendations as to the hiring, firing, advancement, promotion, or any other change of status of other employees must be given particular weight.

Note:   Job titles do not determine exempt status

Compliance Options – Action to Take -Raise salaries of employees who meet the duties tests, whose salaries are close to the new salary level, and who regularly work overtime to a new threshold ($913.00 per week or $47,476 annually) to maintain exempt status. Reorganize Workload, Adjust Schedules or Spread Work Hours.

1. Adjust the amount of an employee’s earnings to reallocate it between regular wages and overtime so that the total amount paid to the employee remains largely the same.

2. Pay employees a salary and pay overtime for hours worked in over 40 per week.

3. Evaluate all categories of white-collar employees to determine which employees do not work more than 40 hours per week. The rule will not impact these employees’ pay because they do not work overtime even though they will become overtime protected.

Source:  Wage and Hour Division, US Department of Labor

Supreme Court Upholds Affordable Care Act’s Federal Subsidies

June 25, 2015

Today the Supreme Court ruled to uphold the Affordable Care Act’s federal subsidies. What does this mean for your business?

November 2014

Healthcare organizations say they are spending a lot of money on compliance and related activities. According to PwC’s State of Compliance 2014 survey, close to one-third of healthcare provider respondents estimate their total annual budget at the corporate compliance function level adds up to $1 million or more.