Read NBAA’s resource on the new overtime exemption regulations”,
Washington, DC, May 27, 2016 – The National Business Aviation Association (NBAA) has released a new resource that provides guidance on how flight departments can prepare for the U.S. Department of Labor’s upcoming changes to its overtime exemption rules. The changes to overtime exemption regulations are among the most substantial since the introduction of the Fair Labor Standards Act (FLSA) in 1938, with the minimum annual salary required for most employees to acquire “exempt” status increasing from $23,660 to $47,476 when the new rules take effect on Dec. 1, 2016.
“It’s one of the largest jumps since the statute has been enacted,” said Greg Ripple, chair of NBAA’s Employment Issues Working Group and a partner at the Miller Johnson law firm in Grand Rapids, MI, who developed the resource for NBAA members. “This more than doubles the minimum salary for the ‘white collar’ exemptions.
“Under the new rules, almost every employee that makes less than $47,500 will be entitled to overtime pay. Moreover, that minimum is going to be adjusted automatically every three years. Employers are going to be constantly having to evaluate salaries of their exempt employees that are on the cusp, so it’s a significant change.”
NBAA’s new resource provides an overview of how these changes will specifically affect business aircraft operators. The resource also contains steps that flight departments can take to prepare for compliance, including updating methods of recording wage hours and developing effective communication plans to ensure that employees understand how the changes will impact them.
“These overtime exemption changes will affect nearly everybody in the industry,” said Brian Koester, NBAA manager of operations. “It’s important for our members to begin preparing for compliance now, and this resource can help them start that process.”
The resource begins with a breakdown of FLSA exceptions for common carriers that uniquely affect business aircraft operators, particularly those operating under Parts 121 and 135. It goes on to detail the three main exemption categories – executive, administrator and professional (EAP) employees; highly compensated employees who make over $130,000 annually; and employees who receive bonuses – and how the new regulations may change their eligibility for overtime pay. This information will help employers identify if the FLSA exemption rules apply to them and, if so, how to make sure they are paying affected employees in compliance with the regulations.
“This resource provides a checklist of steps to make sure that you are paying your employees correctly and that you are maintaining the proper records to demonstrate that you’re paying your employees correctly,” said Ripple.