Fair Labor Standards Act Updates
*UPDATE! NOVEMBER 20, 2024* On Friday, November 15, 2024, a Federal judge in Texas issued an order that voided a scheduled Jan. 1, 2025, increase to the salary threshold for certain exempt employees. University staff should disregard any prior communications they may have recevied from Human Resources about the possibility that some staff might need to transition to non-exempt classification in January 2025 due to this announced threshold increase, as the increase is no longer in effect. Please let Human Resources know if you have any questions whatsoever:
- You may call us at (859) 622-5094;
- You may email us at EKU.Human.Resources@eku.edu;
- You may contact the HR Business Partner assigned to your area: http://go.eku.edu/hr-rep.
Please see below Frequently Asked Questions.
1. What is the FLSA?
The Fair Labor Standards Act (FLSA) is the Federal wage and hour law administered by the U.S. Department of Labor (DOL). The purpose of the FLSA is to establish minimum wage, overtime pay, recordkeeping, and youth employment standards affecting most full‐time and part‐time workers. Employees are either “exempt” or “non‐exempt” from the FLSA regulations. This designation indicates eligibility for overtime pay when overtime is worked. The FLSA requires employers to pay their employees overtime (one and one‐half times the employee’s regular rate of pay) for all hours worked over 40 in a workweek unless they meet a minimum pay requirement and their job duties meet specific criteria to be “exempt” from overtime.
2. What is the difference between an “exempt” employee and a “non-exempt” employee?
An “exempt” employee is paid on a salary basis (a predetermined amount of money for work performed, regardless of the hours actually worked) and is not required to track time worked. At EKU, these employees are paid semi‐monthly. A “non‐exempt” employee is paid based on actual hours worked and is required to track all time worked and be paid overtime for time worked in excess of 40 hours in a workweek. At EKU, these employees are paid bi‐weekly.
3. How is “exempt” status determined?
To qualify for exempt status, employees generally must meet certain tests regarding their job duties. For some of these tests, certain exempt employees must be paid a minimum “threshold” annual salary (see also, question 4 below for updates to some threshold amounts). Job titles do not determine exempt status. In order for an exemption to apply, an employee’s specific job duties and salary must meet all the requirements of the Department of Labor’s (DOL) regulations. Human Resources performs the analysis of exempt vs. non-exempt classification in consultation with the hiring manager for all positions. Most jobs can be classified as non-exempt, but only some jobs can be classified as exempt.
4. What was expected to change in January 2025?
The DOL previously announced that it had revised the FLSA by increasing the salary threshold required for some exempt staff to qualify for exempt status from $43,888.00 annually to $58,656 annually, effective January 1, 2025. As a result of these updates, Human Resources began working with area VPs and managers to review positions impacted by these updates and make decisions about exempt vs. non-exempt status accordingly. A communication was sent to staff in November 2024 announcing this information. On November 15, 2024, however, a Federal judge in Texas invalidated the DOL's actions. There will not be an increase to the exempt salary threshold effective January 2025 as previously announced. University staff who receivied notification that their position was under review for possible transition to non-exempt status should disregard that communication.
5. What does it mean to transition from exempt classification to non-exempt classification?
Staff moving from exempt to non‐exempt:
- Must report all hours worked;
- Must be paid for all hours worked and receive overtime for time worked in excess of 40 hours in a workweek;
- Will be paid bi‐weekly rather than semi‐monthly. Also, bi-weekly payroll is paid on a two-week delay, unlike semi-monthly payroll which is paid at the time work is completed.
- Are not eligible for additional assignments in most circumstances, including teaching assignments that are not included in the employee’s primary job responsibilities. This is a long-time University practice to ensure compliance with FLSA mandates. Regarding teaching assignments specifically, only exempt staff may be approved to teach up to three credit hours per term.
It is important to note that a change in FLSA status from exempt to non-exempt is in no way a downgrade of any position, of a professional status, or of the importance of an employee’s work. EKU is required to abide by Federal law and ensure that employees are paid according to the new FLSA regulations.
6. Does this apply to different industries?
Yes. The FLSA applies to employers in the United States across-the-board regardless of geography, organization size, or the industry.
