Overtime rule may hit some employees hard

Friday, June 24, 2016

YARMOUTH, Maine – Fifty-five percent of respondents to a recent HME Newspoll say they plan to reduce hours for certain employees so they don’t trigger an upcoming overtime rule.

The rule, which goes into effect Dec. 1, requires employers to pay overtime for salaried employees who work more than 40 hours per week and who make less than $47,476 per year.

“I don’t have a lot of salaried employees to start, but I do anticipate having to reduce hours to make sure overtime is minimized,” wrote one respondent.

Some respondents say they may have to do more than just shave a few hours.

“I could see this resulting in full-time employees becoming part-time employees,” wrote one respondent.

Alternatively, 26% of respondents say they plan to pay more overtime to comply with the rule, and 19% say they will raise salaries to avoid it altogether.

Of the respondents who will raise salaries, some say that might come at the expense of losing other benefits, like a company vehicle or vacation time.

A number of respondents say they plan to change salaried positions to hourly positions, a move that exempts those employees from the rule.

“Our retail manager’s salary is currently below this threshold, although close to it with bonus based on sales,” wrote one respondent. “We will likely change the position to hourly, calculate in set overtime and keep the bonus. It will be challenging and will likely be seen as a negative by the employee.”

A number of respondents say the rule will not affect them.

“I already pay overtime,” said one respondent.