Fair Labor Standards Act (FLSA) Overtime Rule

***Effective November 22, 2016, the FLSA Overtime Rule change is on hold due to a preliminary injunction issued by a federal district court judge until further notice.  We will continue to monitor this evolving issue closely and provide additional information as it is available.***

The Department of Labor (DOL) recently passed significant changes to the Fair Labor Standards Act (FLSA) resulting in more employees being subject to timekeeping and overtime compensation. The changes are effective December 1, 2016.

FLSA regulations categorize employees as either “exempt” or “non-exempt” for purposes of being subject to timekeeping and overtime requirements (awarding comp time or paying time and a half for every hour physically worked over 40 hours in one week). At NC State, the regulation applies to all employee categories. It also provides exemptions for certain types of roles including those that are primarily instructional/teaching in nature (including coaches whose primary duty is instructing athletes in performance of a sport); graduate teaching assistants; resident advisors (who receive room and board); some academic administrators; as well as, employees who perform roles that meet the “duties” tests established by DOL related to work in the executive, administrative, and professional fields. Employees who are highly compensated ($134,004+) can also be exempt.

Human Resources (HR) and General Counsel have been monitoring these potential changes and sharing information with campus partners for more than a year and have been working with UNC General Administration, national organizations such as CUPA-HR, and peer institutions to ensure NC State is well-prepared to promptly react to the changes. Now that the regulation is final, HR and General Counsel will be partnering with the Provost’s Office, Internal Audit, and others to strategically use all of the flexibility available in the regulation to minimize impact to campus.

Significant Impacts of the Regulation

In the revised regulation, to be FLSA “exempt” an employee must primarily perform “exempt” duties AND must be paid a salary of at least $913/week or $47,476/year. This new threshold is anticipated to impact many of our employment groups including staff, student employees, temps, post docs, coaches, and some faculty. We’ll be providing more detailed information about the affected groups in the near future.

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