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How to Communicate a Change in FLSA Exemption Status to Employees

Author: Deborah J. Tibbetts, Esq.

Effective December 1, 2016, new overtime regulations from the US Department of Labor will raise the minimum salary for most employees exempt from the overtime requirements of the Fair Labor Standards Act (FLSA) from $455 per week to $913 per week. As a result of the new regulations, most salaried employees paid less than $913 per week (or $47,476 per year) will be entitled to overtime.

To comply with the new overtime rules, an employer may have to reclassify some employees as nonexempt and restructure their compensation plans.

Communicating a change in status to an employee is a delicate matter. Such a change may impact significant areas of an employee's life, including compensation, work schedule, flexibility, work routine, job duties and self-esteem. It is important to communicate a change in exemption status face to face and to be clear, firm and diplomatic.

To communicate a change in status, a prudent employer should be guided by the steps set forth below.