The Fair Labor Standards Act (FLSA) is a federal law that establishes rules for minimum wage, overtime pay, and record-keeping for work hours. Under the FLSA, “non-exempt” employees are entitled to certain protections, including overtime pay. In contrast, “exempt” employees are not entitled to overtime pay, as their roles meet specific criteria related to duties and salary thresholds.
The FLSA has several exemptions that are common to employment in Higher Education (i.e. Teachers, Coaches, Learned Professionals, and Administrative, Academic Administrative, and Executive Employees). Please refer to the following resources for complete guidelines, including rules and responsibilities:
- Wages and the Fair Labor Standards Act provided by the Wage and Hour Division of the U.S. Department of Labor.
- Rights at Work Resource Guide provided by Oregon Bureau of Labor & Industries
November 15, 2024 - UPDATE to Anticipated Changes to FLSA Regulations
A federal judge ruled to strike down the Fair Labor Standards Act (FLSA) overtime final rule. As a reminder, the final rule implemented a two-phase approach to increasing the minimum salary threshold under the FLSA overtime regulations. The first increase took effect on July 1, 2024 increasing the minimum salary threshold from the current level of $684 per week ($35,568 per year) to $844 per week ($43,888 per year). The second increase was set to take effect on January 1, 2025, and it would have increased the minimum salary threshold again to $1,128 per week ($58,656 per year). The final rule also adopted automatic updates to the minimum salary threshold that would occur every three years.
With the decision, the salary threshold set in the 2019 regulations ($35,568 per year or $683 per week) will be the salary threshold employers should adhere to. Any July 1 adjustments provided to SOU employees will remain intact and not reversed.
FLSA Frequently Asked Questions
What’s the difference between exempt and non-exempt employees?
- Exempt status: Exempt employees are salaried employees paid on the monthly payroll and are not subject to the minimum wage and overtime provisions of the FLSA.
- Non-exempt status: Nonexempt employees are paid on an hourly basis and are subject to the minimum wage, overtime, and record-keeping provisions of the FLSA. Nonexempt staff employees must track and record actual hours worked in the appropriate timekeeping system and are entitled to premium compensation for overtime work.
What should I expect if my position will transition to non-exempt status?
- Non-exempt employees must record all hours worked, including start and end times, along with any leave taken in Workday and in accordance with the guidelines set forth by Payroll Services.
- Pre-approval from the manager is required if a non-exempt employee plans to work outside their normal schedule, including advanced approval for overtime.
- If overtime is authorized and worked, non-exempt employees will receive overtime pay or compensatory (comp) time off:
- Overtime is paid at 1.5x the regular rate for hours over 40 in a workweek.
- [Pending Clarification] Alternatively, 1.5 hours of compensatory time off can be earned for each overtime hour.
- Overtime pay will appear in the paycheck following the pay period in which it is earned.
- While SOU is obligated to pay employees for all time worked, including overtime for hours exceeding 40 in a workweek, working unauthorized overtime may lead to disciplinary action.
- If overtime is authorized and worked, non-exempt employees will receive overtime pay or compensatory (comp) time off:
Does anything remain the same when moving to non-exempt status?
The University recognizes that the transition to non-exempt status is challenging, and while differences will be experienced, this transition does not change the job title, responsibilities, or value of the position at SOU. The transition to non-exempt status will not affect the current base pay rate, benefits, or retirement eligibility.
Can my supervisor require compensatory time off instead of paid overtime?
Classified staff should refer to the SEIU Collective Bargaining Agreement for specific details, otherwise, per the DOL, public universities or colleges may compensate nonexempt employees with compensatory time off (or "comp time") in lieu of overtime pay.
Can I flex my time?
Yes. Employees should coordinate with their supervisors to arrange flexible scheduling. For instance, if your supervisor approves you to work one hour late to finish a project, the supervisor may also approve you to adjust your work schedule to account for that additional hour at some point during the week to balance your hours.
If I worked more than 40 hours in a workweek, can I flex my work schedule the following week to make up for the difference?
No, you cannot adjust your hours across two different work weeks. SOU defines the work week as starting at 12:01 a.m. on Sunday and ending at 12:00 midnight the following Saturday. Any hours worked in excess of 40 during a work week are considered overtime and compensated at 1.5x the regular pay rate. As a non-exempt employee, and with supervisor approval, you can flex your work schedule but the adjustments must occur within the SOU defined workweek to avoid overtime.
Can I still work during the evening or on weekends or answer work emails outside my normal hours?
A non-exempt employee may be authorized to work during the evening or on weekends. However, a non-exempt employee must be paid for all hours worked, including overtime pay for any hours exceeding 40 in a workweek. If total hours worked—including evening and weekend hours—exceed 40 hours in a week, pre-approval from your manager to work those additional hours must be obtained.
Any work performed outside of the designated scheduled hours, like answering emails, must be tracked and reported. If you exceed 40 hours per week, this time may qualify for overtime pay. Check with your supervisor to ensure you’re following departmental procedures.
Are non-exempt employees required to take meal or rest breaks?
Yes. Please refer to the SOU HR Wage and Hour Laws and Guidelines website
Do non-exempt employees need to make up time for arriving late or leaving early?
It depends and is based on operational needs and supervisor approval. Non-exempt employees are paid only for the actual hours worked. If they arrive 2 hours late in the morning, they may be required to either work an additional 2 hours during the regular work week or take accrued paid leave as appropriate to account for the missed time. The number of hours an employee works and reports should be equivalent to their FTE. Full-time employees need to work and/or report 40 hours of time/leave each week.
Can I volunteer to work on my own time without expecting payment?
No, non-exempt employees must be paid for all hours worked, regardless of whether the work is performed during regular hours or on their own time. Please refer to the SOU HR Affiliate & Volunteer website for more information.
Do holidays count as hours worked?
Typically, holidays recognized by SOU are counted as hours worked, however, some exclusions apply and the SEIU Collective Bargaining Agreement, SOU Paid and Unpaid Leave for Unclassified Employees policy, and Holiday Schedule should be referenced.
How are part-time non-exempt employees paid overtime?
Part-time non-exempt employees are paid for all hours worked including overtime for any hours worked over 40 per work week. As a part-time employee, it is unlikely that you will routinely need to work over 40 hours in a work week. However, if you do, you will receive overtime compensation.
For Supervisors and Departments
As a supervisor, how can I best prepare for and help communicate these changes to my team?
When an employee transitions to non-exempt status, Human Resources takes the lead on formal notification to the supervisor and their impacted employee. A partnership with the supervisor is required to make sure employees are informed of their new status, work expectations, overtime approval processes, and timekeeping procedures before that date.
The most important step is supporting employees by keeping in close communication, explaining the change, setting work expectations, and establishing time reporting and overtime approval procedures.
It is also important for supervisors to assess the impact of the change on their business operations to ensure continuity of work and support employees. Supervisors are encouraged to analyze the workload of impacted employees to ensure that assigned tasks can be achieved within a 40-hour work week, cross-train employees to ensure equitable distribution of work tasks, and identify and reward process efficiencies.
It is also beneficial to meet with others who work closely with an employee transitioning to non-exempt status to set expectations for working with non-exempt employees. For example, it is recommended that colleagues or collaborators who work closely with non-exempt employees understand that employees are not expected to respond to after-hours email or work requests without authorization from their supervisor.
How do I maintain team morale during this transition?
To ease the transition, supervisors are encouraged to:
- Highlight the positive aspects of non-exempt status, such as earning overtime.
- Ensure open communication to address any concerns.
- Provide resources and support to help employees adjust to new timekeeping requirements.
As a supervisor, what should I consider when setting expectations regarding work hours and accurate reporting of work hours?
The transition to non-exempt status means that supervisors will need to consider the current demands on an employee’s work time and workplace norms that cause an employee to work outside of their standard work schedule. When establishing work expectations, supervisors must be mindful to consider current requirements for employees to attend after-hours meetings, work with constituents in different time zones or work locations, department structures establishing lunch or break periods, protocols for use of laptops/cell phones, travel time requirements, and departmental expectations to work on deliverables outside of work hours.
How do I approve overtime for my employees?
Employees must receive written or verbal approval from their supervisor for overtime before they work beyond 40 hours in a week. Many departments already have established procedures for approving overtime. If you need assistance in developing a procedure, please speak with your department administrator or contact Human Resources.
As a supervisor, it is also your responsibility to ensure your employees understand the overtime approval process prior to their transition.
What happens if an employee works overtime without approval?
Even if overtime wasn’t pre-approved, you are required to pay for those hours. However, an employee’s failure to follow overtime procedures can be addressed through performance management processes. For support with the performance management process, contact Human Resources.
How do I ensure employees aren’t working unauthorized overtime?
Set clear expectations about work hours, encourage employees to disconnect after work hours, and monitor timekeeping records closely to ensure compliance.
As a supervisor, what should I do if I know my employee is working outside of their work schedule, for example, when I see emails sent after work hours?
The transition to non-exempt status is difficult and employees might struggle with the change in work expectations. However, SOU is required to pay for all time worked by non-exempt employees. To support employees with this change, supervisors should discuss work expectations with the employee, including setting expectations about working outside the normal work schedule without prior approval.
Can employees work flexible hours to avoid overtime?
Yes. An unclassified non-exempt employee may flex their work schedule to avoid overtime with approval from their supervisor. For instance, if an employee stays one hour late to finish a project, with your approval, you can change the employee’s work schedule by an additional hour at some point during the week to balance the hours.
It depends. Changes to a classified staff non-exempt position could have impacts on other pay requirements if a flex agreement isn't on file and the SEIU Collective Bargaining Agreement should be referenced
As a supervisor, may I allow my employee to work through lunch?
Asking your employee to work through lunch is permissible provided that it is the exception, not the norm, and there is a valid business reason. However, it is important to remember that non-exempt employees must be paid for all hours worked and working through a lunch break may result in overtime or, to avoid overtime, the need to adjust the employee’s work schedule during the workweek.
My department’s budget is limited and I can’t afford the cost of paying overtime, what should I do?
Many departments are faced with limited budgets and the ability to afford to pay overtime on a regular basis. To limit overtime costs, it is essential that supervisors assess that workload demands are reasonable for a 40-hour work week and to set clear expectations for employees to communicate when demands may result in work outside of their standard work schedule.
