Any employer can struggle to meet governmental regulations regarding exempt employees: those who are not entitled to overtime (OT) pay for work done outside the normal hours. As nonprofit organizations struggle to do more with less, they often have to find innovative ways to get the best use of the talents and energy of employees.
Unfortunately, “innovative” can often mean “running afoul of labor laws” if managers are not careful.
Melanie Lockwood Herman, executive director of the Nonprofit Management Risk Center, has offered a reminder that on December 1, 2016, new guidelines for the Fair Labor Standards Act (FLSA) will be in effect.
To help nonprofits deal with the new rules, the U.S. Department of Labor (DoL) has issued several publications, including a fact sheet on the Overtime Final Rule.
Any nonprofit manager concerned about the regulations should consult the DOL and its Fact Sheets, but Herman notes that exemption from OT for executive employees is limited to positions:
- Whose primary duty is managing an enterprise, or managing a customarily recognized department or subdivision of the enterprise;
- Whose customary duties include supervising work of at least two or more other full-time employees; and,
- Whose authority includes the ability to hire or fire other employees, or whose recommendations as to the change of status of other employees are given weight.