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Overtime Deadline Looms for U.S. Employers

August 11, 2004
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With Congress out on recess, the new federal overtime rules will go into effect unchanged from their April unveiling. Employers and their attorneys are preparing for the August 23 deadline to comply.

The rules are all the more complicated for employers in California, Pennsylvania, Maryland, New Jersey and other states that have their own wage and hour laws. Employers in these states will need to analyze whether their state law is more favorable to employees than the federal law; if so, the state provisions take precedent.

Meanwhile, employers are reviewing the overtime status of their employees and deciding whether that status should be changed -- analyzing both the letter of the law and the retention implications. From a legal perspective, Epstein, Becker & Green attorney Jon Trafimow says that employers should review the duties of all their employees. "Companies need to take a fresh look at what their policies are, and do an assessment to see if they comply with what the new regulations require," he says. Despite what the law allows, Jon Cecil, chief human resources officer at Lee Memorial Health System, says that his Fort Myers, Florida-based company will pay registered nurses for overtime even though it doesn’t have to, according to Business Insurance. Employees are "so hard to find, they’re so hard to keep, there’s such a great shortage out there," Cecil says.

In a background interview with Workforce Management, a
high-ranking U.S. Department of Labor official said he thinks that the government’s goal of simplifying wage laws has been met. After putting on hundreds of seminars around the country explaining the new rule, he says there’s "less confusion" about whether most professional employees are exempt. He says that while millions of low-wage employees who will now be eligible for overtime because they earn less than $455 per week, when it comes to salaried employees "few will be impacted."

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