Unless they are exempt from the overtime requirements of the Fair Labor Standards Act (FLSA), all employees must be paid overtime for work in excess of 40 hours per week. As soon as April of 2024, the Wage and Hour Division of the United States Department of Labor (DOL) is expected to issue new final regulations that will increase the salary threshold to qualify for exemption from overtime requirements under the FLSA, making many more employees non-exempt and eligible for overtime.
Currently, to be exempt, an employee must satisfy both the salary threshold and duties tests for exemption. The duties tests vary depending on which exemption is being examined (See this article for more information about the various exemptions that typically apply in nonprofit organizations: Proper Worker Classification in the Nonprofit Workplace: Avoiding Misclassification Issues. The salary threshold (the amount an employee must be paid to be exempt) is currently $684 per week or $35,568 per year. Under the proposed regulations, the salary threshold will increase to $1,059 per week or $55,068 annually. Any employee who is paid less than $55,068 per year may become non-exempt and eligible for overtime pay if these regulations go into effect.
PBPA will provide guidance for nonprofits about the new regulations when there are enacted. As the DOL finalizes the regulations, read the article from Kilpatrick Townsend to learn what considerations your nonprofit should take now to prepare for these changes.