NACo releases analysis on new overtime rules
June 28, 2016
The U.S. Department of Labor recently finalized a new rule on overtime pay that could significantly impact county payrolls. CSAC weighed in with concerns about this new rule, which increases the salary threshold to $47,476 per year, increases the compensation level for highly compensated employees to $134,004 per year, and creates automatic annual adjustments for the salary thresholds.
The National Association of Counties (NACo) provided some detailed analysis about the potential impacts to counties across the country. Chiefly, the NACo report notes that “this change will make millions of previously ineligible employees eligible for overtime pay, and will significantly impact county governments.” In some cases, these increases will be quite sizable and counties may struggle to absorb the payroll increases (or make do getting the work done without that overtime work).
NACo notes that state and local governmental entities have some discretion to comply with the final rule:
· Raise salaries
· Pay overtime above salaries
· Evaluate and realign employee workload
· Utilize “comp” time
The new rule will take effect on December 1, 2016 and applies to all white collar workers.