Thousands of employees will likely move from non-exempt to exempt, and thousands will likely move from exempt to non-exempt. For some companies with a lot of low-wage employees, labor costs could rise; at the very least, managers may have to do more juggling to avoid overtime costs. Firms with more professional employees may find that more of their workforce is exempt; this could lower costs in the short run but potentially cause morale issues.
Even human resources technology vendors are watching the action. Companies such as Cybershift, Workbrain and Kronos are likely to get peppered with questions from their customers. “It’s an administrative nightmare for people,” says William Larkin, Kronos’ vice president of HRMS solutions. “It’s creating a lot of fear, uncertainty and doubt.”