Do you foresee having two individuals who perform the same position, one just has more tenure and therefore is paid more, being exempt and the other being non-exempt?  

July 23, 2015 E-Alerts

We have multiple requirements before we’re able to classify employees as exempt from overtime.  One is the duties test, which if they are performing the duties of an executive exempt work that would be met.  The other is the salary basis test, which means they would need to be paid on a salary basis each workweek, which is a guaranteed amount of pay equal to or in excess of the salary level.  The salary level must meet or exceed the amount set by the federal government, which looks like it might be an annualized figure in excess of $50,000 come 2016.

So, yes, if some people in the same classification (Branch Manager, for example) are being paid at least the salary level and others are not you would have employees in the same classification treated differently for overtime compensation purposes.  The DOL estimates that most employers in this situation will increase the wages of the less tenured employees.  It appears to be the primary motivation behind the making the change to the salary level test. 

A question from Kevin Mosher's HR webinar "Politicians Did What? Legislative Review & Forecast” regarding new overtime regulations. Please contact Kevin Mosher if you have further questions.

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