Is your organization ready for the new changes surrounding the Fair Labor Standards Act (FLSA) overtime rule? If you’re not aware yet, essentially what will happen is that on December 1st 2016, the minimum salary for employees to be considered exempt from the FLSA overtime provision will change to $47,476, which is equivalent to $913 per week. On paper, this change may appear to be plain and simple, but realistically speaking, this isn’t the case. The ramifications of this change will be significant around the workplace, especially from a compliance standpoint. As my colleague, Casey Lewis, identified in an earlier blog, the impact of this change will impact both employer and employee. It’s imperative for organizations to maintain compliance to the new rule. Fortunately for employers, with today’s HCM technology, maintaining and keeping up with any compliance changes, in this case for overtime, doesn’t have to be complex or complicated any more.
Today’s HCM technology empowers businesses to accomplish several aspects imperative in maintaining compliance with the upcoming FLSA changes:
- Determine which employees qualify for overtime – minimize effort
Employers need to determine which employees will be moving from ‘exempt’ to ‘non-exempt’ status. Employers are tasked with identifying any employees that make more than the current threshold of $23,660 but make less than the new threshold of $47,476. Through today’s HCM technology, employers can easily identify employees that fall within the defined salary thresholds. Less time is spent on gathering the required details.
- Reporting – financial impact
As this change to the existing FLSA overtime provision can impact overall labor costs for any organization, it’s crucial for employers to examine the potential financial impact. Financial reporting can be time consuming, with large quantities of information to gather and review. If an organization is relying on separate disparate systems, capturing all this data is even more challenging. Accuracy of information is key, and relying on multiple systems increases the risk of errors. Businesses benefit from solutions with a single database containing all the relevant information. By leveraging today’s HCM solutions, organizations have the ability to obtain accurate financial information and make financial reporting less strenuous to complete.
- Implementation – easy of configuration
In the past, when a change to an employment rule is made, employers were often left scrambling to find out the required steps to remain compliant. Do any of their processes need to be changed? This could be a great ordeal and would usually lead to headaches and frustration. Now, with today’s HCM technology, a change to any legislation can be handled more swiftly and with greater ease. Today’s HCM technology operates on platforms that enable users to configure specific rules according to the state that they are in. Talk about making it easy.
If you’re a business that’s still contemplating about making the transition over to one of the many HCM solutions, with the upcoming changes to the FLSA overtime provision, now may be the time. By leveraging today’s HCM technology, compliance doesn’t have to be difficult.