Exempt Or Non-Exempt? Proper Worker Classification Under the New FLSA Overtime Rules

Is an employee exempt or non-exempt under the Fair Labor Standards Act? The new rule from the USDOL went into effect on July 1, 2024, and a more pronounced change will go into effect on January 1, 2025. Are you ready?

If you’re confused about which employees are exempt and which are non-exempt, you’re not alone, and you must be sure that your employee classifications are accurate. Classify employees incorrectly and it can cost you big time… it may even land you in court!

The new FLSA exemption rule makes significant changes in which of your employees will now qualify to be “exempt” and therefore not be entitled to overtime. Employees who were previously classified as exempt may now need to be reclassified to non-exempt employees and will then be entitled to overtime. Employers need to be prepared so you will be able to properly classify employees as exempt or non-exempt, under the new FLSA overtime Rule.

In this session will go through in-depth the proper analysis needed to classify your employees as exempt vs. non-exempt based on the new FLSA regulations. We will show you how to ensure compliance with FLSA overtime rules, including the current and upcoming changes to the FLSA regulations, and explain the changes that employers need to understand and comply with.

Employers must ensure that their employees are not improperly classified as exempt when they should be non-exempt. In the event of an employee lawsuit or an audit by the DOL, employers will be required to substantiate their reasons for classifying a particular employee or employee as exempt. In addition to enforcement action by federal and state departments of labor, improper classifications have resulted in many collective action lawsuits by groups of employees, many of which have resulted in multimillion-dollar settlements.

Participants will have the opportunity to learn:

• The key changes to the USDOL’s new exemption rules under the FLSA
• A method to assess whether a position meets the requirements to be exempt under the FLSA
• The three USDOL tests that must be met to classify a position as FLSA-exempt
• The requirements of the “duties test” for white-collar exemptions
• Various state laws that go beyond the FLSA exemption tests, so you can properly classify your employees working in those states.
• What you need to do to prepare for the coming rule change on January 1, 2025

• The three core changes to the FLSA’s overtime rule that employers must address properly.
• How the Salary level test has been raised from the current FLSA Rule.
• Understand how to properly classify employees based on the overtime rule revisions to the FLSA.
• The three DOL Tests of Exempt Status: the Duties, Salary Basis, and Salary Level Tests.
• Understanding the “duties tests” and how to meet FLSA requirements for the Executive Exemption, the Administrative Exemption, the Professional Exemption, Computer Professional Exemption, and Outside Sales Employee exemptions.
• The Highly Compensated Employees Exemption.
• The Importance of a Compliance Review.
• How California and other states’ rules differ from the FLSA.

On April 23, 2024, the Department of Labor (DOL) issued a new rule that significantly increases the minimum salary level to qualify for the "white collar" overtime exemptions under the Fair Labor Standards Act (FLSA). Understanding these new regulations is critical for employers, as it will likely require them to make changes to remain compliant.