Overtime Pay Law Changes

May 18, 2016


Ben ThomasIncreasing the salary basis threshold for overtime pay has been discussed and proposed for some time. The federal government announced today that the new overtime pay thresholds will go into effect on December 1, 2016.

This law will affect more than 4.2 million employees nationwide and will have a dramatic effect on businesses in New Mexico, touching an estimated 20,000 workers’ salaries in the state.

The amended rules will change the salary level for employees to be exempt from overtime pay from $23,660 per year to $47,476.  Or said another way, from $455 per week to $913 per week.

For many employers, the employees you once considered exempt from overtime may no longer be exempt.

We encourage you to look at which of your employees will be affected by this change.  You may consider adjustments for the affected employees–whether it be raising salaries, closely monitoring hours to account for overtime, or other options.

We expect that the final rule presented by the Department of Labor will be challenged in the courts or through Congressional action, which could delay the effective date. However, we encourage all employers to prepare for December 1, 2016.

If you have any questions or would like to discuss how best to adjust to the rule change, please feel free to email me at BET@sutinfirm.com or call me anytime at 505-883-3385.

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