1. What Did The 2024 Overtime Rule Aim To Change?

The 2024 Overtime Rule outlined a phased increase in salary thresholds for employees eligible for exemption from FLSA’s overtime and minimum wage requirements. These changes included:

July 1, 2024:

• Standard salary threshold increased from $684/week ($35,568/year) to $844/week ($43,888/year).
• Highly compensated employee threshold rose from $107,432/year to $132,964/year.

January 1, 2025:

• Salary threshold for exempt employees was set to rise to $1,128/week ($58,565/year).
• Highly compensated employee threshold was to increase to $151,164/year.

July 1, 2027, and every three years thereafter:

• Salary thresholds were to be recalculated based on the 35th percentile of weekly earnings in the lowest-wage U.S. region.

The intent of the 2024 Overtime Rule was to extend overtime pay eligibility to more workers. However, the rule did not alter the duties test, which remains an essential component in determining exemption status.

2. What Did The Texas Court

Decide?

The court invalidated the 2024 Overtime Rule, ruling that the DOL exceeded its statutory authority under the FLSA.

Key Findings:

• The FLSA allows the DOL to define criteria for overtime exemptions, including salary thresholds. However, the court found that the DOL set the thresholds so high that salary alone overshadowed the duties test, contradicting the FLSA’s intent.

• Congress intended for both salary and job duties to determine exemption status. The court held that the 2024 Overtime Rule improperly prioritized salary thresholds, undermining the role of job duties in exemption determinations.

3. What Does This Mean For

Employers?

The court’s decision invalidates:

• The planned January 1, 2025, increases.
• The salary thresholds implemented on July 1, 2024.

Employers must revert to the pre-2024 thresholds:

• $684/week ($35,568/year) for white-collar exemptions.
• $107,432/year for highly compensated employees.

4. Could The DOL Appeal The Decision?

The DOL may appeal the ruling to the Fifth Circuit Court of Appeals, which could:

• Uphold the decision, keeping the 2024 Overtime Rule invalid.
• Overturn the decision, potentially reinstating the rule.

The DOL has 60 days to file an appeal. Employers should monitor developments closely as the situation evolves.

5. Does This Ruling Affect Broader Overtime Exemption Rules?

No. The ruling specifically addresses salary thresholds for overtime exemptions under the FLSA. The duties test remains unchanged.

Employers must continue to assess both salary and duties when determining exemption eligibility.

6. What If Employers Have Already

Implemented The 2024 Salary Increases?

Employers who raised salaries or reclassified employees based on the July 1, 2024, thresholds may:

• Revert to pre-2024 thresholds.
• Retain changes based on business considerations, such as employee morale and operational needs.

When making adjustments, employers should clearly communicate decisions and evaluate compliance with federal and state regulations.

7. Could The DOL Introduce A

New Rule?

Yes.

The DOL has the authority to propose a new overtime rule, but it must address the court’s concerns and follow the formal rulemaking process. Any new rule could take months or years to finalize.

8. How Does This Ruling Impact State Overtime Laws?

The ruling affects federal FLSA rules but does not override state-specific overtime laws.

States with stricter salary thresholds or duties tests require continued compliance with those standards.

Why Your Business Needs A Workplace Cell Phone Policy

45 Second Read Time

Due to the addictive nature of cell phones, it's crucial to address their presence in the workplace by adopting a clear cell phone policy in your employee handbook.

3 Reasons Why Your Business Needs A Written Cell Phone Policy.

1. Focus & Productivity: Employees who are always on their phones struggle to concentrate at work and are consequently less productive. A standard cell phone policy needs to be implemented because this is one of the main worries of employers.

2. Preventative Measures: Unfortunately, cell phone abuse can lead to accidents in the workplace. Therefore, depending on what type of business you have, it would be wise to have a policy in place to prevent any incident/accident from occurring. i.e., a business with labor-intensive jobs where employees must operate heavy machinery, move around, or drive will have a different policy than one where employees sit at a computer all day.

3. Security: Information security breaches are frequently reported by businesses that offer WI-FI to their employees. A company should take every precaution to avoid this because it can result in major security breaches or malware intrusion.

Exit Interview: 12 Questions

All Employers Should Ask 

 43 Second Read Time

It’s difficult to part ways with an employee, especially a very good one, but unfortunately, it happens. However, when faced with this situation, it is important to conduct an exit interview in order to lower turnover rates and raise retention rates.

12 Exit Interview Questions To Ask.

1. Why are you leaving? 

2. What resulted in you searching for another job?

3. What area(s) do we need to improve on? 

4. Do you think you were equipped with the right tools to do your job well?

5. What was the biggest factor that encouraged you to accept this job?

6. What did you enjoy most about your job?

7. What could we have done better? 

8. What circumstances will motivate you to return to the company?

9. Do you feel like your job description has changed since you were hired? If so, in what ways? 

10. Would you recommend our company to a friend looking for a job?

11. Did you feel you were a valuable part of the company?

12. How would you describe our company culture? 

How To Prepare Your Staff For New 2025 Handbook Changes

24 Second Read Time

When introducing changes to your employee handbook, it's crucial to prepare your team effectively to ensure smooth adoption.

Here are four tips to help you manage the process:

1. Announce Your 2025 Changes Early: Communicate updates well in advance, allowing employees time to understand and ask questions.
2. Host Informative Sessions: Hold face-to-face and/or Zoom meetings to explain key updates and how they impact daily operations.
3. Provide Clear Documentation: Share an easy-to-understand summary of the changes, along with the updated handbook.
4. Offer Follow-Up Support: Ensure HR or management is available for ongoing questions, as some employees would like clarification on their specific needs.

How Long Should You

Keep Employee Records

27 Second Read Time

The Fair Labor Standards Act (FLSA), enforced by the U.S. Department of Labor (DOL), requires employers to maintain various payroll records for specific durations.

• Employers must keep records of employees’ personal details, such as names, addresses, dates of birth, occupations, pay rates, and weekly earnings, for a minimum of three (3) years.
• The same three-year (3) retention period applies to collective bargaining agreements, including any modifications, as well as individual employment contracts and written agreements under the FLSA.
• Sales and purchase records also fall under the three-year (3) rule.
• You should retain employment and earnings records, wage rate tables, salary and overtime details, work schedules, and wage deductions for two (2) years.