Overtime Final Rule in Effect: How Timekeeping Can Help

The Department of Labor (DOL) released the final rule, which effectively updated the Fair Labor Standards Act (FLSA) requirements for overtime pay.

What is the Final Rule?

The final rule determines which employees qualify for overtime pay. To be exempt from receiving overtime pay, an employee must meet the following requirements:

• Receive a salary (rather than be paid hourly)
• Meet a salary threshold
• Perform professional, administrative or executive duties primarily (also known as the “white collar” exemption)

It went into effect July 1, 2024, requiring employees earning less than the minimum salary threshold to be paid at their overtime rate (time and a half) for all hours worked beyond 40 in a workweek.

As of July 1, the minimum salary threshold is $43,888 per year (or $844 per week). The previous threshold was $35,568 ($684 per week). There is also a planned increase on January 1, 2025, taking the threshold to $58,656 ($1,128 per week). It will then update automatically every three years based on wage data.

We covered the change earlier in the year. Review that post for additional detail.

You can also learn more about the final rule here.

Timekeeping and Managing Overtime

As mentioned, the first step for employers should be determining which employees are affected by the final rule. According to estimates from the DOL, over a million exempt workers fall between the old and new thresholds. From there, consulting with a labor law expert to determine the best course of action is an important step.

If you choose to reclassify employees to earn an hourly wage, timekeeping is an absolute must. Tracking employee hours ensures accurate pay and helps your business maintain compliance with the laws established under the FLSA, as well as other labor regulations. Additionally, time-tracking supports transparency while maintaining employee responsibility.

But not all timekeeping platforms are the same. In fact, some make it easy for employees to pad their timecards and get paid for hours they didn’t work. When you consider the fact that labor is a big chunk of your overall business budget, it’s not an area where you want to have a lot of extra costs. And when employees are earning time-and-a-half for overtime, managing those extra hours is essential.

Ensuring Compliance

Maintain compliance with legal requirements while ensuring payroll accuracy with WorkforceHub. This time and labor platform automates the tasks associated with tracking employee hours. With flexible time collection methods and useful features for employees and supervisors, it’s the timekeeping solution you’ve been looking for. And it supports teams of all sizes across nearly every industry.

Employee time-tracking doesn’t have to cause a lot of headaches. Instead, it can be a seamless process with available features like geofencing (location-based punches) and detailed reporting. You can also make the most of the mobile app for remote and on-the-go workers, or opt for a smart time clock that uses physical indicators (facial or fingertip scans) to record employee punches.

WorkforceHub does it all. Don’t be without it when you need to track employee time.

You can even try it for free!