the new overtime law is here — if you earn less than $35,568, read this

by Alison Green on January 6, 2020

Now that you’re back at work for the new year, you might be seeing some major changes to your pay.

The new federal overtime law went into effect last week on January 1. Here’s what it means for you:

If you earn less than $35,568, you now must be paid overtime (time and a half) when you work more than 40 hours in a week.

Some background: The federal government divides all workers into two categories: exempt workers, who are not required to receive overtime pay, and non-exempt workers, who must receive overtime pay. The exempt category is reserved for employees who perform relatively high-level executive or professional work, outside sales employees, the “learned professions,” and a few other narrowly defined categories. To be considered exempt, you have to meet that duties test, be paid on a salary basis (i.e., your pay isn’t docked when you miss work), and earn at least $35,568 (until the law changed yesterday, that number used to be $23,660).

In other words, if you earn between $23,660 and $35,567 a year, you didn’t used to be eligible for overtime pay, but now you are. Your employer might handle this by:

  • paying you overtime whenever you work more than 40 hours in a week, as now required by law
  • increasing your salary to the new threshold of $35,568 in order to keep you exempt and avoid having to pay you overtime
  • prohibiting you from working over 40 hours in a week or requiring you to get advance approval for any overtime
  • reducing your base hourly wage in order to account for the overtime pay you’ll receive, thus keeping your overall annual compensation the same

Keep in mind that if you’re in the group of people affected by the change, it might change how much flexibility your employer gives you. For example, if you’re currently able to work 35 hours this week when work is slow and work 50 hours next week when demands are higher, you might not be allowed to do that anymore, since your employer will have to pay overtime for those extra 10 hours the second week.

Here are answers to some questions you might have:

Does this apply to very small businesses too, or only employers over a certain size? What about nonprofits?

It applies to anyone covered by the Fair Labor Standards Act, which is nearly all employers in the U.S. It covers nonprofits if they engage in interstate commerce, which includes receiving or sending interstate mail, email, or phone calls, or if they have $500,000+/year in business revenue.

Are there any professions that don’t have to meet the salary test to be exempt?

Teachers, doctors, lawyers, and outside sales professionals are not subject to the salary test; they are automatically exempt regardless of how much money they earn. A few additional categories of jobs also are automatically exempt from overtime, like employees of movie theaters, many agricultural workers, most railroad workers, and many truck drivers. But pretty much everyone else has to meet the new salary threshold (and the duties test) to be exempt.

Is the salary threshold prorated for people who work part-time?

Weirdly, no.

If I’m becoming non-exempt, will I have to be hourly instead of salaried?

Possibly, but not necessarily. Your employer might choose to make you hourly, but they could also make you “salaried non-exempt,” which means you’d stay salaried but they’d add on overtime payments in any weeks you work over 40 hours.

Can they pay us in comp time instead of overtime pay?

Only if you take the comp time within the same work week it was earned (thus keeping your total hours worked that week at 40 or fewer). Otherwise, your overtime must be paid in money and in your paycheck for the pay period in which you earned it. (Exceptions to this: state government employers, which have conveniently exempted themselves from this rule.)

But what if I want to be paid in comp time that I can save up and take later?

Nope. Still can’t.

Last time, they killed this at the last minute. Is it really the law this time?

It’s really the law this time. It took effect last week.

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{ 206 comments… read them below }

  1. Angelinha*

    If a nonprofit doesn’t engage in interstate commerce but then they happen to get an email from someone in another state (like, they’re in Florida and they get an email from someone in Maine asking for information about their food pantry) does that count as interstate commerce and force them to follow this new law? If so, is it forever or just for the next year or until the next time they get an interstate email?

    1. pentamom*

      Interstate commerce has a legal definition. Apparently it has to involve financial consideration in return for some good or service (commerce), not merely communication.

    2. K Roberts*

      Does your NFP org ever call customer service phone numbers? Do you have a website? Have you ordered anything? Do you have out-of-state donors? “Interstate commerce” is very broad. But more importantly, if your organization can’t pay people for more than 40 hours per week, don’t make them work more than 40 hours per week. It’s better for morale if you assume this law applies to your organization and treat your employees as if they are deserving of the pay they receive for the work they do.

    3. Lifelong student*

      I do not believe this is only applicable to interstate commerce businesses. The FLSA preempts state law as far as I know.

      1. Amy Sly*

        It’s still justified under the Commerce Clause though. Marijuana that you grow on your own property, dry on your own property, and smoke on your own property without ever involving another human being in the process is still considered “interstate commerce”; the Commerce Clause is the elastic waistband of the Constitution that the government uses to pretend it still fits in the same pants as it did in 1783.

      2. fposte*

        For nonprofits, it likely matters, because the other threshold is doing $500,000 of business, which a lot of nonprofits wouldn’t do. (The DOL example is an animal shelter that also provides veterinary care services for a fee–if they bring in more than $500k annually from the fees they’d qualify as a covered enterprise that way.) If it doesn’t do $500k business a year, the feds basically leave the matter to the state if nobody at the NP deals with anybody outside of the state. I’ll link to the relevant fact sheet in followup.

  2. Lifelong student*

    According to what I have been told, even if approval is required for overtime according to policy, any overtime worked, approved or not approved must be compensated as overtime.

    1. NerdyKris*

      Yes, they have to pay you for time worked according to the law regardless. If someone is working unapproved overtime, the way to address that is through internal disciplinary action, not docking pay.

    2. Jennifer M.*

      They have to pay you for the OT you worked, but they can also fire you for not getting approval to work the OT.

    3. Countess Boochie Flagrante*

      Yep. They can’t avoid paying you by saying they never explicitly ordered you to work the OT. Otherwise that would be a giant gaping loophole.

      1. NerdyKris*

        I’m going to make a random guess and say that was probably a job filled by minorities during the Jim Crow era, and that’s where the exception came from.

        2. Amy Sly*

          Eh, the movie industry gets all kinds of favorable tax and labor treatments; apparently, politicians really like reasons to hobnob with celebrities.

          One of the conservative bloggers I follow notes that a possible reason why Hollywood types are so convinced capitalism is so corrupt, nepotistic, and exploitative is that their industry is perhaps the most corrupt, nepotistic, and exploitative in the country, and so they just assume every other industry is just as bad.

          1. Zip Silver*

            I mean, you aren’t wrong. Guys like Harvey Weinstein aren’t the exception, but rather the rule. He just happened to be the sacred cow that they sacrificed. The term ‘casting couch’ originated in Hollywood, rather than adult film.

            1. Amy Sly*

              Lord, I loved Ricky Gervais last night. “Our next presenter is in Bird Box, a movie about people who act like they can’t see a thing. Sort of like working for Harvey Weinstein.” The audience boos. “You did it; I didn’t.”

              1. Zip Silver*

                He also made the “Epstein was your friend… Had to fly here in your own place” joke. Absolutely mad lad.

        3. fposte*

          According to a Jacobin article, it was the other way around–movie theater projectionists were the main employees and they were professionals with clout.

        4. Thgor*

          It’s more the opposite. In the 30’s, cinema employees projectionists were skilled professionals. The code has just never been updated to reflect the modern reality of the industry.

          1. Diahann Carroll*

            That’s actually fascinating that they were considered professionals, but given the nature of the equipment and how easy it would be to destroy the reels, I could see that. Thanks for the info!

    3. Wren*

      When I worked at an amusement park, I found out that they don’t have to pay minimum wage. Some industries had better lobbyists and got themselves exempted.

      1. Red Reader the Adulting Fairy*

        I worked at Cedar Point the summer after I graduated high school, and we were exempted from overtime rules (but not minimum wage rules) because they were somehow classified as a “carnival” which meant we were “temporary carnival workers.” So we were regularly scheduled for 60+ hours a week at $5.25/hour.

        1. Pretzelgirl*

          I grew up near cedar point, and had friends that worked there. I got mixed reviews from former employees. It was the best summers of their lives. Working, partying, hooking up, going to the beach. Or you are worked to death and it was terrible!

        1. ArtsNerd*

          Virginia finally repealed the King’s Dominion law last year (which was one of those states, though I expect not the only one.)

      3. Gaia*

        When I worked for a boat tour company, I learned they were exempt from FLSA. We were considered sea workers even though my main job was pointing at whales and selling coffee.

    4. fposte*

      The full list is wildly eccentric to modern eyes and seems to reflect whatever lobbying was most in sway when FLSA was first passed in 1938. There’s a lot of agricultural specificity (outside dairy buyers, livestock auction workers, etc.) and seasonal stuff (people who work in their home making wreaths are exempt, as long as the wreaths are “made principally of evergreens”).

        1. fposte*

          Just imagine what our country would have looked like if the brave congressfolk hadn’t stood up for the coniferous.

      2. Bagpuss*

        Fascinating – I guess that it was intended to allow for temporary workers making Christmas wreaths, or huge increases in workload at that time of year, , but protect those making them for funerals year round? Or something like that.

    5. AndersonDarling*

      I’m wondering if that originated with drive-in theatres that only operated seasonally. Their employees worked lots of hours, but only for the summer.

    6. Cookie Captain*

      Having worked in a movie theater, I think the argument could be made that the job inherently has quite a bit of down time while movies are playing, at least in a smaller theater, so you aren’t technically “working” for much of the day. I don’t agree, but I can kind of see the logic.

        2. Evan Þ.*

          Still less onerous if you can play around on your phone, lean back and talk to your coworkers, or duck in to see the movie.

          I still agree it’s work that deserves to be paid, but I can see where some people are making the distinction.

          1. Ego Chamber*

            Is that how it was at the theater where you worked? We weren’t allowed to use our phones during shift and we definitely couldn’t eff off to go watch a movie while there were concessions to stock and things to clean. Employers generally aren’t allowed to keep you from talking to coworkers because NLRA but I don’t consider talking to coworkers “not working.”

            (I’ve never worked at a theater that didn’t pay standard time and half overtime but I’ve also never worked at a theater that gave anything near full time hours to anyone lower than management.)

      2. find me later*

        Isn’t that being “engaged to wait”? Companies still have to pay you for that time. Like delivery drivers, you can’t just say, we’ll pay you when there’s something to do.

    1. ThatGirl*

      Originally it was going to be around $47k, but right before it was going to go into effect, a judge put it on hold, and it’s taken three years to get to this revised version.

    2. fposte*

      They tried that and it was blocked by the court. Even more frustratingly, that effort included indexing the threshold to wage growth so it would automatically keep going up rather than needing a big jump to catch up years later; the OT rule that passed includes no indexing, so we’ll have to push again to make the threshold reasonable down the line.

    3. Reba*

      Don’t be sorry! There was a proposal a few years ago to raise it to around 47K (IIRC), but it was blocked in court. Interestingly, that blocked rule was also going to make the threshold increase periodically. It seems like the new level is a kind of compromise between the old, too-low cutoff and the proposed 47.

      1. AcademiaIsWeird*

        It was $47,476. I know some places (specifically academia but maybe others) went ahead with it even though it was blocked. Academic offers with future start dates were being made with that number and changing the offers after it was blocked by the judge would not have been a good look . Still crazy that many PhDs were making under the $47,476 and had to have their salaries bumped up significantly in 2016 when that happened.

        1. Captain Raymond Holt*

          The job I had at the time moved us from salaried to hourly in November, a month ahead of the anticipated passing of that law. When it didn’t pass, they left us as hourly (and non-exempt). It was wonderful, because our team definitely worked some OT and now got paid for it! But some people were upset at the perceived loss of “status” by being hourly instead of salaried. I was perfectly fine with it and so was my wallet :)

        2. Discordia Angel Jones*

          My husband is doing a PhD in a STEM subject and he’s making $24,000 a year….

          Unless you mean postdocs (i.e. people with PhDs)?

          1. The Man, Becky Lynch*

            I feel myself die inside when I hear these numbers. You can make more loading trucks.

              1. The Man, Becky Lynch*

                I’ve never hired anyone part time before for labor jobs…nor have I known anyone in warehouse work who had PT, given it’s demands. Unless we’re talking about seasonal jobs of course.

                But I do know that stores and the food industry are different though, those are full of PT employees.

                1. fposte*

                  I mean the academic pay is for part time. $24k is pretty standard for a 50% time assistantship.

              2. Discordia Angel Jones*

                He’s teaching the maximum allowed but yes I don’t think it’s classified as a full time TAship.

          2. AcademiaIsWeird*

            Yep, sorry for not being clear. People who already have STEM PhDs and are appointed in post-graduate positions such as Postdocs.

          3. postdoc*

            Yep. They bumped up postdoc salaries significantly in 2016 to keep us exempt. PhD students don’t count as employees so the law doesn’t affect them. Technically, students receive a stipend and are “studying” by performing their PhD research.

          4. Kiwiii*

            Do they at least throw housing subsidies and free college credits in with that, or is he meant to be paying for things out of that $24,000? because that seems bananas

            1. Reba*

              Typically a package includes tuition remission (i.e. credits/classes are free). Otherwise, yes, it is fairly bananas!

            2. postdoc*

              Most STEM PhD programs I know of pay the students’ tuition and health insurance. So the $24000 is meant to cover living expenses. However I have heard of a few where covering tuition and health insurance is not guaranteed, which really really sucks.

              1. Diahann Carroll*

                That’s horrible if they don’t get their tuition and insurance paid. I guess they only want people with trust funds or those married to folks with high paying careers in the program.

                1. Close Bracket*

                  Plenty of un-partnered people with no trust fund make it through grad school. In fact, the majority of grad students are un-partnered and do not have trust funds.

                2. ArtsNerd*

                  … Student loans are still available for graduate school. Most professional graduate degrees (medicine, law, business, as well as MFAs and some others) are rarely, if ever, tuition-free and many don’t come with paid assistantship opportunities.

                  It’s how a lot of Americans rack up 6-figure student loan debts. And a good chunk of those degrees don’t come with any guarantee of a high-salaried position at the end of it, though it’s seen as a requirement for even the most entry level jobs in the field, e.g. museum studies…

              2. Discordia Angel Jones*

                I’m late responding but hey, might be useful info I guess.

                Yes, tuition is covered for my husband but:
                1. Health insurance comes out of that $24,000 at about $350 a month
                2. Whether or not your “student fees” are covered depends on the PI. That is c. $1,500 per semester.

            3. William*

              When I was a PhD student (9-13 years ago) I got between $13k and $17k per year and tuition (but not fees) covered.

              Considering that I was coming from a job that paid $36k with good benefits….my wallet did not approve.

              1. William*

                (And no, I didn’t have health insurance covered; I had to buy it myself. Which I’m still paying for)

          7. AcademiaNut*

            Yeah, your husband is a student. If he’s being paid for work (as a teaching assistant, or work outside of campus) he should be paid at least minimum wage, but if the $24,000 is after tuition, and he’s not holding a full time job outside of school, he’s doing pretty well for a full time student.

            On the other hand, lots of postdocs are going to be hit by this threshold, particularly in less lucrative subjects. Fifteen years ago, as a STEM student in a lucrative subject in a department with endowments, I made $19,000 a year after tuition, with a combination of scholarships and TA work. My first postdoc was ~45,000 (all taxable income), but that would have been near the top of postdoc salaries, if you looked across fields. However, non PhD holding regular employees at the same institute made more than I did.

        3. Diahann Carroll*

          It was $47,476. I know some places (specifically academia but maybe others) went ahead with it even though it was blocked.

          I worked for an insurance company that had our HR department review all job titles/pay grades prior to the $47k ruling going into effect, and several of our entry level claims adjusters went from salaried exempt to non-exempt, which pissed them off. This meant that they had way less flexibility about how long they could take lunch breaks (which, in our stressful environments, you’d often need an hour and a half to decompress from a really bad day of non-stop calls from angry claimants) or when they could leave in general – it was a bad move because they did essentially the same thing as the rest of us who were at Senior levels, just with less claim settlement authority.

          Some of our divisions rightly understood that the newer claims adjusters would be upset by becoming non-exempt and, thus, promoted them up to the first Senior level position they could be in. All promotions at that company came with a raise, so everyone also got pay bumps.

          Then the ruling never went into effect. People were concerned that they would be demoted back down to their old titles, but the company let all promotions and salary increases stand.

        4. That Girl from Quinn's House*

          My husband was a postdoc during those years, he absolutely had his pay raised several times in anticipation of that legislation. I think it raised him to around minimum wage in our metropolitan area.

    4. Starbuck*

      Some states at least are doing that – WA state is going to be raising their threshold significantly over the next several years. I think it’s projected to cap out at something like $60k+

        1. Bookworm1858*

          I’m based in CA and just had a discussion with a fellow salaried employee – we’re seeing $54,080 for 2020 with $4k increases over the next two years.

    5. Jennifer Thneed*

      But COL varies so widely all over the country! I don’t see how any one number can be appropriate for everywhere.

  5. JeanB in NC*

    I’m having a hard time with the classification of a few employees. We are a private Montessori school that starts at 18 months through 8th grade. I don’t have a problem with the elementary teachers – they are obviously exempt – but what about the toddler teachers? They don’t necessarily even have a bachelor’s degree. Does anyone know about this?

    1. fposte*

      To be clear, the duties tests are the same as they always were; this isn’t changing them. But the line between preschool/daycare can be a blurry one. Here’s some text from the DOL (from Fact Sheet #46) about preschool teaching:

      Bona fide teachers in preschool and kindergarten settings may qualify for exemption from the minimum wage and overtime pay requirements as “professionals” under the same conditions as a teacher in an elementary or secondary school. Teachers are exempt if their primary duty is teaching, tutoring, instructing or lecturing in this activity as a teacher in educational establishment. It should be noted that, although a preschools may engage in some educational activities, preschool employees whose primary duty is to care for the physical needs for the facility’s children would ordinarily not meet the requirements for exception as teachers under the applicable regulations.

    4. CHew on this*

      Degree wouldn’t matter, whether or not they go over 40 hours is the only thing that matters. If they’re part time and don’t go over, then you’re fine. If they go over, you need to pay the time and a half.

      1. fposte*

        Jean’s asking about whether they’re exempt or not, which is a matter of the duties test for teaching; if they meet the duties test, they’re exempt and don’t have to be paid more for hours over 40.

  7. Potato*

    Does anyone have any advice for how to raise this with my employer? I don’t want to seem annoying or confrontational, but if it’s the law, I do want to be treated accordingly, and I know I’m the only one at my job who earns below the threshold. They haven’t brought it up, and I don’t know if it’s because they don’t know or they hope I don’t know.

    1. Steady Betty*

      Bring them an article you read and use language that assumes they are already planning to make a change because “of course” they want to be in compliance. Something like, “I was wondering how this new law will affect my pay structure moving forward.”

      2. Yorick*

        And Alison recommends stuff like, “we could get in trouble if we don’t follow this new law”

    2. Iris Eyes*

      A collaborative “how would you like us to handle this going forward?” May be a good opening.

      Something that allows for both the assumption that of course they are going to follow the law but also that they may not have realized that it will actually apply to someone who works for them.

    3. DecorativeCacti*

      My significant other will be affected by this. He, and another employee who is also affected, are planning on waiting until their next paycheck which should have overtime and then going to their boss like, “Oh, hey, looks like a mistake was made on my paycheck since that new law was passed.”

      I don’t necessarily agree it’s the BEST approach, but I would definitely go at it with a nonchalant, “of course you’ll do the right thing” attitude

      1. OhNo*

        I think a pre-emptive “How do you want me to report overtime hours?” conversation might work better. That way, boss and employee are both on the same page about how it’s going to be handled.

        It might result in less overtime being offered or expected, but in my personal opinion it’s better than risking needing to file a wage dispute over a check after the fact.

    4. Venus*

      Alison has some letters which address this. Sorry I don’t have the time to look for them, but essentially it’s a discussion on ‘my company is doing something illegal, how do I tell them to change?” The wording is well done, and is essentially what Steady Betty and Iris Eyes have written. You might also want to consider starting with something like “I’m not sure if you’re aware of these new rules, and I know you are a good company that aims to be good to their employees (even if this is a lie, it’s a good assumption to start off with), so what do you need from me to make this work?”

    5. That would be a good band name*

      Also worth noting: they are allowed to have 10% of your salary come from bonus/commissions as long as it’s paid at least annually. No idea if that could apply to you, but just in case.

    6. Upstater-ish*

      I just said to my employer that NYS was raising their threshold affective 1/1/20 And they needed to pay me.

      I also made some not so funny jokes about only getting minimum wage.

  8. CatCat*

    So curious about all the seemingly peculiar exemptions so I looked up the FLSA. Just FYI, if you’re employed in the “processing of maple sap into sugar (other than refined sugar) or syrup,” then you aren’t entitled to overtime pay.

    Big Maple got to Congress though they didn’t win on that refined sugar issue.

    1. fposte*

      Yeah, I’d love to know more about the history on a lot of these exemptions. Quite a few of them (like maple processors) are occupations that could be considered seasonal, so that isn’t completely unreasonable to me, but who got their knickers in a twist about the wreathmakers? Why?

        1. fposte*

          But the exemptions aren’t for every seasonal job or based on seasonality. Somebody singled out wreathmakers (and in very specific terms) and left Christmas tree cutters, tobacco harvesters, fruit canners, etc. behind. Who was the Wreathmaker’s Friend?

          1. agmat*

            It’s not just seasonal, but it’s agricultural. I’d guess most ag and ag-adjacent (pretty much anything prior to the grocery store or market) jobs are exempt.

            You can make wreaths out of non-coniferous materials (paper, ribbons, etc) that are therefore not ag related.

      5. Wandering*

        Well, if your knickers got twisted into a wreath you might get hung up too…

        I’ll show myself out now.

    2. TCO*

      The traditional method of processing sap is to boil it slowly and continuously for days. (Depending on the type of tree, it takes 40+ gallons of sap to make one gallon of maple syrup!) My guess is that because syrup-making requires 24-hour work, but only for a short period each year, it somehow got exempted.

    3. hbc*

      It looks like the majority is seasonal and/or low-intensity-long-hours work. I guess I can see some logic there, that you need people making wreaths for about two months of the year, or that it’d be really hard to switch truckers off to keep them at 40 hours per week.

      But then, it’s probably not that great to be making wreaths or picking fruit at $10/hour for 70 hours a week just to be able to rest for a couple of months. (They probably just move on to work their butts off at the next seasonal job.) It looks a lot like some industries were all “we’re special, you can’t ding us for the fact that our employees have to work long hours” and the regulators decided to overlook the employee protection aspect.

  9. EPLawyer*

    I love that lawyers are exempt. Trust me, I know lawyers making less than $35K a year but putting in hours. Still being affected by the 2008 recession and the glut of lawyers who were laid off during that time.

    1. fposte*

      That probably comes under the heading of “Be careful what you wish for”–I bet lawyers pushed hard to be exempt in 1938.

  10. Professor Ronny*

    >Exceptions to this: state government employers, which have
    >conveniently exempted themselves from this rule.

    Since this is a federal law, state governments cannot exempt themselves. The federal government exempted them.

  11. Nervous Nellie*

    Just want to mention, for those in Washington State, the news is even better. A tiered 8-year overtime eligibility plan is now in place. The state governor’s office has confirmed that this will override the federal rules, because it is more generous.

    https://lni.wa.gov/workers-rights/wages/overtime/changes-to-overtime-rules

    About halfway down the page the link to ‘new salary implementation procedure’ shows how the threshold will rise until 2028, when it will plateau. It is currently at $35,100, but will rise to an amazing $83,300. Now THAT is helping the middle class! I hope that info is useful.

    1. Allypopx*

      I would guess the seasonality of the job has something to do with the logic. But teachers should be making more money.

    2. The Man, Becky Lynch*

      They’re regularly employed by the state government, they love making anyone who’s money comes from the government level to be exempt from laws that govern the private business world. And then the private teachers out there are punished because they can say “also learned professional category, works too here.”

    3. Kiwiii*

      Probably several pieces of the profession including 1) seasonality and 2) to meet the number of required education hours/year for a child, there’s likely going to be over 40 hrs of work some/most weeks

    4. Tzeitel*

      There’s maxim in labor laws that “professional” careers do not require labor protections. Teachers/lawyers/doctors etc. This is becoming more and more untrue as wages stagnate and hours working increases.

    5. Sakura*

      I find this really disturbing. When I was working as a teacher, my day started at 7:30am and the kids were dismissed at 3:30pm. I had to wait for kids to leave before I could go into the building. I had a 20 min lunch, which was usually used as a meeting to discuss issues happening that day. This means that I had almost 8 hours with children, though some days I may get a 30-40 min planning period but it’s not guaranteed if there is some school event taking place or the special teachers are out that day.

      After the children leave, I can work on my grading, lesson planning (writing lessons, researching, collaborating with other teachers, tying to other subjects, checking off standards, evaluating assessments, previewing videos and other technology, creating rubrics), cleaning/decorating/taking decorations down/organizing the classroom, taking meetings with parents/administration/students/other teachers, working on professional development which usually included online courses, working on parent newsletters, updating my website, planning events such as field trips or school functions, tutoring, coaching/leading a club, answering emails and phone calls, overseeing after school events such as dances and sports games, overseeing detentions, etc. So in a normal day I’m staying until 6-7pm, which means that during a completely normal week I am at the school working about 11 hours daily, but on Fridays I do the majority of lesson planning and will be at the school until anywhere from 9-11:30pm. Then you have to consider that there are often events – conferences, Open House, school plays, dances, dinners, etc and I am at the school until 8-10 on those nights.

      When you consider the hours worked and all the things that have to be done it’s easily several full time jobs worth, and I did it all with advanced degrees for a salary under 35k.

      It is absolutely disgusting that teachers are exempted from this, especially when you consider that many of the best teachers – the teachers who put in the most time, effort, creativity, and themselves into this career – end up burned out and leave the field. There is no way to not do the work as there isn’t any time during the school day. There is no way to just leave at a reasonable time. We need to move away from a system that requires teachers to give up their lives for low pay to be successful, not work with it.

  13. Stephen!*

    My employer already went through and adjusted salaries upwards to keep people exempt. Though I made more than the threshold, I also received a nice pay bump. Happy New Year to us all!

  14. The Man, Becky Lynch*

    Washington is also rolling out more increases to the exempt thresholds over the next 8 years. In 2021 it’s going up to 43,0004 for 1-50 employees and 50,180 for over 50 employees for example.

    This pleases me greatly.

  15. JohnSnowsPumpHandle*

    I have a question about this. I work in a health nonprofit at a desk job. I’m salaried exempt, but my pay is docked if I don’t make 80 hours/pay period. They will first go to my leave bank, even if it’s 79.9, they will take 0.1 hours, which is sucky but fine. But if a person does not have time available they will deduct it from their pay. Is this legal?

    1. Countess Boochie Flagrante*

      If you’re classified as exempt, they can’t be taking it out of your pay unless you qualify for the exemption as a doctor (which I definitely cannot assess). However, there are very few laws AFAIK regarding how your employer handles PTO banks.

      1. Countess Boochie Flagrante*

        And I realize I made a hash of that first sentence, because I started to add something that I later deleted about how exemption is determined.

    2. Allypopx*

      Deducting your PTO is probably legal, but your salary no they can’t do that if you’re exempt.

    3. Ask a Manager* Post author

      They actually *could* dock your time if (a) they have a bona fide sick leave plan and (b) you’ve used up all that leave, but only if (c) it’s for full-day absences, not partial day absences OR (d) it’s partial day but it’s for time taken under FMLA.

      Assuming that’s not the case here, they are treating you as non-exempt, have lost the legal right to the exemption, and now owe you overtime for all the hours you’ve worked over 40/week.

    4. fposte*

      Using your leave is legal. Docking you pay for a full-day absence is legal under a few circumstances–if you’re out of vacation and want the day off being the main one, but it needs to be your desire to have the day off, not their desire to save the bucks and send you home.

      However, docking for a partial day is asking for trouble. I see one reference to that being possibly legal for intermittent FMLA, and another for safety violations, but it doesn’t sound like the situation you describe.

  16. Anonymeece*

    Hmmm, do college employees count under this if they’re not adjuncts/professors?

    I have several non-exempt staff that for now get paid in comp time (we don’t offer overtime) if they go over 40. Would that change?

    2. Ask a Manager* Post author

      Are you a state university? If so, it’s legal. If not, then it’s never been legal to pay non-exempt staff in comp time (unless it’s taken in the same week).

      2. ThatGirl*

        Follow-up/related – my husband is staff (a mental health counselor) at a private university and is right around the threshold – it was a whole big thing when the rule was first going to go into effect, and the short version is that he is now considered a 10-month employee and gets two four-week periods off (in addition to standard PTO). Similar to teachers, his pay is spread out over the year. If he’s under the threshold, would they need to raise his pay, or would the 10-month calendar mean they’re in the clear?

        1. fposte*

          That’s beyond me, so I’m just guessing. If he got 10 checks a year for the months actually worked rather than spreading it over 12, would those meet the monthly threshold? If the answer is still no I suspect they’ll have to figure something out, but if he’s getting compensated above the threshold for the actual months he’s working and the pay method is just slightly different, that might suffice.

          1. ThatGirl*

            Yeah, I’m not 100% sure what his pre-tax pay is per check/month (he gets paid every other week) but it’s gotta be really close to the monthly threshold. I’m sure if it’s just a matter of raising his pay a few bucks they’ll do that. It would be a bigger question if it had been the original $47k. The whole thing was pretty weasely, though he’s gotten used to the mini-sabbaticals.

            1. fposte*

              Yes, social workers, etc. really got in the churn on this one, because they’re traditionally exempt but very often paid low. There’s likely to be a lot of paper shuffling happening around them.

    3. Avid reader infrequent commenter*

      Public universities are considered non-profit institutions. I asked the same thing and then ended up finding my own answer :)

      1. Allypopx*

        Non-profits are still held to this standard, I think you’re confusing non-profit with state-employee.

        2. Avid reader infrequent commenter*

          I am. That’s what I get for trying to go over this post while slammed at work. My bad, sorry guys!

  17. The Bookworm*

    I’m curious as to what Alison and others may thing about my employer’s move. My team has been non-exempt/hourly employees for the last few years, and based on this FLSA change are now moving to exempt/salaried.

    I’m in a more senior role, so I make slightly more than most of my peers, but we’re all set between about 35 and 45k/year. The demands of the role shifts depending on the time of year … which is important, because since we’ve also been short-staffed for the past two years, most folks in the office are making between 3 and 10k in overtime pay every year.

    Now, we’re being moved to salaried, which means more flexibility, hypothetical comp time (which often apparently doesn’t materialize for leadership) and no timesheets. But we’re being salaried “at our current rate”, which effectively means a paycut. A serious paycut, considering that our office is shrinking yet again (for the near future at least) which means more hours for everyone.

    I know it’s legal. But isn’t this pretty … low, all things considered? I mean, I’m biased, but these are folks who are not exactly rolling in $$ and who are taking on a LOT of work. I love a lot of other things about this company, but wow, this is making me think seriously about starting a more intense job hunt. Am I right to be upset, and would this be a big deal for you? If it makes a difference, some other proposals for fairly low-cost benefits to staff have also been shot down recently, which is probably coloring my feelings about this.

    Thanks!

    1. Allypopx*

      That would be super demoralizing to me. Is there anyone you can make a case to? You might have more standing to push back, as a more senior employee.

      1. The Bookworm*

        Allypopx, thanks for the validation! I’ve been as far up the ladder to push back as I can, but we found out this might be happening literal days before Christmas break, and it officially went into play January 1. It’s pretty awful that even VP-level folks agree it’s a bad move….and yet nothing changes.

    2. Countess Boochie Flagrante*

      That’s a huge deal. They’re effectively cutting your pay tremendously — and considering what the company has been paying out in OT until now, I would seriously question whether you guys actually qualify for exempt status. Monkey business around exempt/non-exempt is extremely common.

      1. The Bookworm*

        Ugh. They’re moving the very entry-level just-started folks to exactly 35 and change, and those who’ve been here longer and gotten small merit raises, etc. will stay the same.

        Back in the day this was a salaried/exempt role. When it looked like the compensation threshold was changing a few years back (as Alison references), the positions were preemptively shifted to hourly/non-exempt in order to comply. Frankly, people didn’t mind much, since that set us up to make more. And now we’re switching back. So yeah, it’s obnoxious, but we do meet the skills test…and have in the past. As far as I can tell, it’s about saving a few bucks.

      2. NotAnotherManager!*

        I agree – we’ve moved several people from non-exempt to exempt when they moved into higher-level professional or management positions, but the very first thing we look at on comp is how much (total) did the make each of the past three years (OT fluctuates) to ensure we’re not asking them to take a paycut – and actually giving them a real raise – for a higher-level position that nearly always includes more responsibilities.

        Monkeying around with people’s pay in the negative tends to lose you the very employees you’d like to keep.

    3. Kiwiii*

      Does the work you do qualify you to be exempt? If it’s the same position you were doing previously, I would guess that it doesn’t.

    4. The Man, Becky Lynch*

      This is going to kick them in the teeth for retention and also when they are hiring for these positions again, bad choice from that level which is what they should be thinking about. Along with the morale demolishing that’s going on. It will end up hurting everyone who stays and the entity in the end because they’re going to struggle to find capable employees moving forward who are willing to work as hard as they require for peanuts.

      This set up is literally why I am pretty much against ever accepting a salary again unless it’s a very specific circumstance.

      1. The Bookworm*

        I’m super worried about this too. I love the company for a lot of other reasons and aside from this it’s worked for me, but gosh, I feel like I’m about to be On a Hellmouth 2.0 if I decide to stay when half the team turns over in months.

        1. TardyTardis*

          Then don’t. Move while the economy is still stoked on a trillion dollars of ’emergency financing’ from the
          fed.

    5. fposte*

      I’m a little puzzled by the idea that this is happening because of the threshold change–the threshold change makes more people *nonexempt,* not more people exempt. Maybe the change just caused them to look at finances?

      At any rate, yes, this sounds like a sucky deal, and I also think it’s worth checking to see if you’re properly qualified as exempt under the duties test, not just the pay test.

      1. Allypopx*

        It sounds like they were given raises to put them over the threshold but they’re losing secondary benefits.

        1. fposte*

          But the threshold didn’t matter since they were already non-exempt. That’s the weird part.

          1. Allypopx*

            OH I see. Maybe the company had to raise other employees/had other sections impacted by this and raised this department when they looked over the books and realized how much they were paying in OT?

              1. The Bookworm*

                Allypopx/fposte, I think you’re right. It is weird! That said, we’ve been experiencing other budget cuts this year – I have a feeling someone said “oh look, $X savings by cutting overtime for these roles” and that was that.

                2. The Bookworm*

                  My nesting is off, but NotAnotherManager, I sure hope so. Almost half of our team (top performers) are looking elsewhere.

    6. Diahann Carroll*

      Yeah, I’d be really upset about going from non-exempt to exempt at my same rate of pay – that is a pay cut no matter how you slice it, especially if you’re used to always working more than 40 hours a week. My old company moved a lot of adjusters from non-exempt to exempt by promoting them to the next pay grade for their job family, and that promotion came with a pay increase regardless of whether or not the person was under the exempt pay threshold. They’re also a company that makes about $4billion a year in profits, so they could afford to do so. Still, I would expect to be given some sort of increase if they were taking away my guaranteed overtime income or else I’d be looking for a new job. Presumably, I accepted the position and stayed in it was because it met my needs and I was able to pay my bills with it, but a pay cut would ensure I wouldn’t be able to cover my basic living needs, so off I’d go.

      1. The Bookworm*

        The horrible part of that is we have mandatory (and I mean mandatory) weekend/after hours events. So, I can literally be fired for working 40 hours a week. I can understand a switch to salaried for various reasons, but asking us to take a pay cut to work the same/additional hours?!?

    8. Jennifer Thneed*

      So, this sounds just like a letter we had here, not sure when because I re-read it recently, maybe it was in updates? Anyway, there was a place that tried to pull this, the LW and co-workers pushed back, and the company said “OOPS MATH IS HARD” and threw HR under the bus. Yeah?

      Bookworm, this is very similar. Your employer’s own documentation proves what you all have really been making and what hours you’ve been putting in, and they should make your salary equivalent OR do a lot of hiring so nobody needs to work more than 40/week.

  18. Fabulous*

    I wish this was in effect 10 years ago!! Was making $31,000 working probably 50ish hours a week, including several Saturdays… :/ So glad I’m not there anymore, but back-pay would be nice!!!!!

    1. Tina Belcher's Less Cool Sister*

      I’m just laughing thinking about my husband’s former employer – a bar who paid their “assistant managers” $25k to work 60-70 hour weeks. I’d be shocked if they raise wages to comply with this law. Fair labor practices were…not something the owner was concerned about.

  19. Avid reader infrequent commenter*

    What if I’m staff (not faculty) at a state university? I make $30K/yr and am coded as salary non-exempt. I don’t get paid overtime, I just get comp time. Should I be expecting changes, or concerned that I haven’t heard about any upcoming changes?

      1. Avid reader infrequent commenter*

        Yup..had a chance to do a little more research and read a little closer after I asked. Oops!

    1. Allypopx*

      What’s your technical employment status? Are you an employee, who receives a W-2? If so, are you a state employee?

        1. Allypopx*

          Hmmmm. Well at 21k a year would mean that nothing is really changing for you, as the old threshold was about 23k. But as to whether or not this applies to you it probably depends. As fposte outlined below it’s definitely a grey area and I would assume they feel at least somewhat legally justified with whatever they’ve been doing. But you can certainly look into it more if you’re concerned.

    2. Reba*

      No. Graduate students are not classed as employees. (Even though you are working and the whole house of cards would come down without your low-comp labor!) The university considers you to be primarily a student, with your work responsibilities being part of your degree-earning process.

      1. fposte*

        It’s actually a bit of a gray and contested area. NLRB has gone back and forth on it, and it’s complicated by the fact that there are several different kinds of graduate assistantships with different kinds of tax and other financial treatment. (So teaching assistants and research assistants may fit differently into the law, and pre-professional grad students, whose waivers are taxable, are a whole nother problem.)

        1. Reba*

          You’re right! I was going on my first-hand and second-hand experiences, which are non-science non-profesh.

          One phrase I encountered in the DOL guidance that’s interesting is that of “graduate teaching assistants whose primary duty is teaching” which seems… subjective! Where I was educated they are like “we have an educational relationship, because we just say so” and because the teaching is considered to be, again in DOL parlance, “duties part of an overall education program.” I suppose the % time of the appointment is part of the “primary duty” test.

          Taxes are a whole other thing again! Ugh. When I was a grad student the university did not have to give me a 1098T and so there was just… nothing? And absolutely no advice. I just kept track of the bursar statements.

          1. fposte*

            With ours, since we’re state, we have some latitude, but there’s also a union–which only covers some categories of graduate assistant. So I’m not sure how the situation is going to unfold here.

    3. Lady Kelvin*

      It depends on how you offer is worded. Most graduate assistants (research and teaching) are actually being paid as part-time (20 hours a week). The rest of the time you spend in class and doing research is considered part of your education, so you aren’t getting paid for it. Since you are part time, you can refuse to work more than 20 hours a week on your stuff, but since it is usually related to your dissertation/thesis, you don’t. The exceptions I’ve seen are teaching assistantships, which are almost always less than 20 hours of week of work, and I’ve known people who are on a grant for funding and work on that research for 20 hours a week, then spend as much time as they need working on their own research because their thesis is a different topic but they couldn’t get funding for it.

  21. SalesPro*

    I am an outside sales rep, have always been exempt until my most recent role where I was presented with a non-exempt salaried role. Where I am essentially guaranteed 40 hour week salary but I also receive overtime. It’s for a tech company based in Silicon Valley and it was explained to me that this is a trend for similar companies.

    Anyone else see this? Most of my network was unfamiliar with this practice. It made for a weird salary negotiation conversation as I felt very out of my element.

  22. The IT Plebe*

    And here I thought my 20% raise last August was completely merit-based. :(

    Honestly, just goes to show that I am well and truly underpaid (IT in a high COL area) and that I need to ramp up my job search.

  23. Lissi70*

    I’m a salaried employee with a base of 30K yearly. I do, however, have the potential to bonus each month. If I’ve read correctly, 10% of the bonus I receive can be added to my yearly salary. If this is correct, and going by 2019 numbers I’m still below the threshold. I have heard nothing from payroll or HR in regards to this. Is this based on 2019 numbers?

    1. fposte*

      No, it would be going forward from now, but if your numbers aren’t changing, it looks like you would indeed be under the threshold. There’s some language upthread for talking to your bosses.

    2. Iris Eyes*

      I believe it is not 10% of your bonuses that count but all of your bonus up to 10% of the amount. So up to $3556 of the minimum could come from bonuses.

  24. Brett*

    A few notes on comp time:
    – Comp time has a cap of 240 hours. If you hit the comp time cap, you must be paid overtime.
    – Local government employees in most cases are also under the comp time exemption like state employees. This is because local governments are considered extensions of the state government from which they derive their charter to exist. (There might be exceptions to this depending on how the local government was formed, e.g. bi-state compact governments are federal in origin instead of state in origin.)
    – If you have comp time, the agency you work for can deny you from using that comp time if it would be unduly disruptive for you to use it. This is really important for the next point.
    – If you considered law enforcement, fire protection, or emergency response, your cap is 480 hours, and there are a mess of other special rules that can make it very difficult to use that comp time under the unduly disruptive rule. When I worked emergency response, this functionally meant most people ended up getting their comp time paid out at the end of the year or when they retired instead of using it.

    2. K.K.*

      Some employers in my field allow employees to “buy” 1-2 weeks of vacation a year (usually on top of 2 weeks provided standard). Is that considered a form of comp time? Are there legal limits to the rate the employer can charge – for example, can they charge the fully burdened salary or only the stated salary?

      1. Ego Chamber*

        Comp time is trading hours off for hours worked instead of paying the money earned while working. Your employer is selling additional time off in exchange for money, it has nothing to do with hours worked so it’s not comp time.

        (Wtf is going on with employers in your field tho? They let you “buy” vacation and then use the money to “pay” you your salary when you take the time off? Why not just offer unpaid time off and let employees handle their own finances like adults?)

  25. whoknows*

    What a bummer that teachers are exempt from this. I have so many friends and family members who are struggling to make ends meet and have been working in teaching for 5-10 years and are still making under 40k. It’s truly absurd.

  26. Professional Confusion*

    For the learned professional exemption, is the standard for “prolonged course of study” a master’s degree?

    I’m a post-graduate with a bachelors degree in a technical science field and for some reason, only the post-bachelors at my company (large government contractor) are considered exempt employees. The post-masters and post-docs are both non-exempt. I pass the duties test and I make more than the minimum salary but when I asked Class & Comp, they gave me the party line of “we’re following FLSA regulations”, which isn’t an answer as to why.

    Overtime is strongly discouraged and the exempt employees accrue comp time freely, which is why I’m wondering if this is something I should push harder on.

    1. Professional Confusion*

      Ugh last comment, promise, but I got it backwards. Post-bachelors (myself) = non-exempt. Post-masters and post-docs = exempt. I’m discouraged from working overtime and can’t accrue comp time, everyone else can accrue comp time freely.

    2. Ego Chamber*

      No, there’s no standard degree level. If you meet the duties test and the salary test but they don’t want to change it, it’s probably some weird social power dynamic status thing (FLSA is easy to blame and who knows, maybe they even believe it). It’s v stupid but there’s nothing to really push back on. They’re allowed to keep you non-exempt if they want to, it’s the other way that they’d have to fix.

  27. Professional Confusion*

    Forgot to mention – I’m a time-limited employee (all the post-grads are) but I’m a full-time employee of my company and I receive a W-2. I’m not currently a student, either.

    1. fposte*

      Teachers have been exempt from this for decades; none of that was changing. The only thing that changed was the pay threshold for those subject to a pay test.

  29. Lucy P*

    What if an employee, based on hourly rate, should be making over the threshold, however, due to many absences (not covered under FMLA), the employee ends of working less and makes less than the threshold?

  30. Remove Worker and Dog Lover*

    I’m glad the law is going into effect this time. My work prepared for this a few years ago and all the employees got raises so we were all still above the exempt threshold. One in particular received a pretty substantial raise, about 50% more than what they were making before. When the law was challenged in court and just sort of died, my boss decided to leave salaries as is even though they no longer had to keep us all that high of a salary just to be exempt. It was a nice gesture.

    I appreciate the commenters who left the link to the Washington state policy. I wasn’t aware it was happening and it impacts my organization! Thankfully there’s a fairly gradual roll out if you’re small.

  31. Lauren*

    AAM – Does this mean that those that make over $35,567 no longer qualify for OT pay?

    I live in Massachusetts and 1/2 my office is between this number and 50K and were getting OT previously. Our HR is in a different state (PA) and even federal laws are like ‘deer in headlights’ news to them and I would like to be on top of it for my office mates.

    1. Ask a Manager* Post author

      If you’ve been getting overtime at that salary, that’s your company’s own decision, rather than the law. This wouldn’t change that (unless they decide they want it to).

      1. Elizabeth West*

        That’s good to know. I made more than this at Exjob (hourly). In my experience, most employers just don’t let you work overtime so they don’t have to pay it–you just put in the 40 hours.

        The law’s figure wouldn’t go as far in BiggerCity. I really need to make more than I did in SmallCity but I don’t want to end up scraping to get by as if I were still making $12 an hour.

  32. HKM*

    As someone outside the US, I’m curious, is there any specifics as to why those numbers were selected for the threshold? They seem incredibly specific

  33. Anna*

    It feels unfair that this doesn’t apply to teachers. I’m a preschool teacher at a private preschool and earn under $33,000 per year. Most teachers at my school work 45 hours a week, though after 3 years of this I was able to reduce my hours to 42.5 hours a week. I live paycheck to paycheck and have 2 kids and could use some extra money.

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