Catherine Belliveau
on
In the ever-evolving landscape of labor laws, on April 23, the Department of Labor (DOL) finalized a new overtime standard. This has the potential to significantly impact how funeral homes and funeral service businesses manage their workforce and finances.
Key details of the new overtime standard are as follows:
- Increased Salary Thresholds
- Effective July 1, 2024, employees earning up to $43,888 per year and working more than 40 hours per week will be eligible for overtime pay at a rate of time-and-a-half.
- This threshold will rise to $58,656 per year starting January 1, 2025.
- Exemption Criteria
- Under the Fair Labor Standards Act, workers are exempt from hourly overtime requirements if they work in executive, administrative, and professional capacities, commonly referred to as the “white-collar” exemptions.
- To qualify for the exemptions, employees must meet a duties test and, in most cases, be paid a minimum standard salary for each workweek.
What are the implications to the funeral profession? Salaried employees in the funeral profession who currently earn less than the specified threshold will no longer be considered exempt from overtime pay. Consequently, they will be entitled to receive time-and-a-half compensation for any hours worked beyond the standard 40-hour workweek.
The threshold is set to increase further, reaching $58,656 annually as of January 1, 2025. This rise underscores the need for funeral businesses to adapt their payroll practices to comply with evolving regulations. Conducting a thorough payroll audit is the first step. This will help identify employees currently designated as exempt who may fall below the new salary thresholds. Additionally, implementing robust tracking mechanisms for salaried employees’ work hours is imperative for accurate compensation.
Owners must make strategic decisions regarding their workforce. Should you adjust salaries to maintain exemptions, or is it more cost-effective to transition employees to hourly compensation structures? Each option carries financial implications that require careful consideration.
Legal challenges and potential shifts in administrations could alter the fate of this rule. Therefore, while employers should prepare to comply with the Final Rule, they should keep in mind that the deadline for compliance may end up being far off in the future.
By staying informed, conducting audits, and making informed decisions, funeral businesses can navigate these regulatory changes while ensuring fair treatment of their employees.