Paycor’s quarterly Power User Group, presented by Dr. Gia Wiggins, SPHR, SHRM-SCP, focused on compliance with updates to the Department of Labor’s (DOL) Fair Labor Standard Act (FLSA) and new overtime and pay transparency rules. Here are some highlights in case you missed the session.
The Fair Labor Standards Act (FLSA) establishes minimum wage, overtime pay, recordkeeping, and youth employment standards.
- FLSA Minimum Wage: The federal minimum wage is $7.25 per hour effective July 24, 2009. Many states also have minimum wage laws- higher minimum wage prevails (FL $8.56)
- FLSA Overtime: Covered nonexempt employees must receive overtime pay for hours worked over 40 per workweek at a rate not less than 1.5x regular rate of pay. Not required to pay overtime for work on weekends, holidays, or regular days of rest, unless overtime is worked.
- Hours Worked: Hours worked ordinarily include all the time during which an employee is required to be on the employer’s premises, on duty, or at a prescribed workplace.
- Recordkeeping: Employers must display an official poster outlining the requirements of the FLSA. Employers must also keep employee time and pay records.
Overtime rule updates include an increase in the Standard Salary Level from $455 to $684 per week and the Highly Compensated Employee threshold has increased from $100,000 to $107,432 per year.
How to Stay on the Right Side of the Law
Further in her discussion, Dr. Wiggins outlined steps to take to help ensure compliance with the various rules and regulations, including:
- Conducting an audit of all exempt employee salaries to determine if any are beneath the new threshold.
- Reviewing (or developing) job descriptions with employees’ actual duties
- Conducting the FLSA duties test of each position
- Reclassifying or promoting employees who are beneath the salary threshold
Pay Transparency
Employee pay is addressed by several federal laws including:
- Equal Pay Act of 1963 – Requires that men and women in the same workplace be given equal pay for equal work.
- Lilly Ledbetter Fair Pay Act – Clarifies that discrimination based on age, religion, national origin, race, sex, or disability will “accrue” every time the employee receives a paycheck that is deemed discriminatory.
- National Labor Relations Act – Protects employees’ rights to band together with coworkers to improve their lives at work, including discussing wages at work.
It’s important to have pay transparency for a couple reasons:
- Employees talk – They will discuss their pay with coworkers.
- Perception of fairness – When employees know what they and their coworkers are being paid it promotes trust in the organization.
How to Design Transparent Pay
- Review all salaries by job description
- Develop pay grades/bands and pay levels for each role
- Review existing salaries
- Modify existing job descriptions using new pay grades
- Use a performance review to grade each employee
- Communicate and implement the new pay structure
How to Access
- File path: “Resources” at the top of the home screen and select “Customer Exclusive Webinars”
- Click the three lines next to “Select Product” and pick “Paycor Power User Groups” from the dropdown
About the Speaker
Gia Wiggins, PhD, SPHR, SHRM-SCP
Gia Wiggins, founder of Morale Resource, LLC, received a BA in Psychology and Sociology from Grambling State University. After working as a Human Resources Manager for 16 years, she completed her MBA from California State University. She received a Ph. D of Business Administration at the University of South Alabama with a concentration in Management. Gia currently serves as an Adjunct Instructor with the University of South Alabama and the University of Mobile teaching Human Resources Management, Intro to Business, and Business Communications.
Gia has held executive human resource management roles in companies such as AT&T (formerly Southwestern Bell), Sears, Target Corp, Cintas Corp, and BAE Systems Southeast Shipyards. Gia serves on the Board of Directors and Leaders Council with the Eastern Shore Chamber and Board of Advisors with the Mobile Area Chamber of Commerce.