Marshall University Fair Labor Standards Act (FLSA) Resources

• INCREASED nonexempt/HOURLY (overtime eligible) employees.
• MANAGERS will have to manage overtime more closely.  Overtime will need to be approved and budgeted in advance.
• EMPLOYEES converted from Exempt to Hourly will have to be paid for all hours worked over 40 in the work week.  This may also include compensatory time.
• Checking email and doing work outside of the normal work schedule will change the way these converted employees accomplish the “day to day” work after January 1, 2025.
• Converted employees are now eligible for overtime.
• They must track hours worked in TimeClock Plus.
• Clock in & out, track all hours worked, observe start/stop times, observe meal & break periods.

Employee Classifications who are NOT IMPACTED by the Change (BUSINESS AS USUAL)

• Teaching Faculty (Adjuncts, Full Time, Tenured, Instructional)
• Graduate Assistants (Graduate Teaching Assistant)
• Resident Assistants
• Research Assistants
• Postdoctoral Fellows (Primary Teaching Duties Only)
• Faculty Coach (recruiters only are effected)
• Nonexempt employees (Hourly Employees)

Employee Classifications IMPACTED by the change

• Current Exempt employees who are paid under $58,656 annually and fall within one or more of the below classifications.
• Current Exempt Employees who are paid over  $58,656 annually will be reviewed under the duties test and may be converted to non-exempt.
• Non-teaching faculty
  • Researchers
  • Librarians
  • Administrators

• With the effective date being January 1, 2025, the University has developed a timeline for the Implementation Plan.

• View the complete PowerPoint presentation on the FLSA-Overtime Rule Change.

• In order for exempt employees to maintain an exemption status they must meet both the “salary” & “duties” test.
• Duties Test – the employee’s job duties must primarily involve executive, administrative, professional, computer or outside sales duties (also known as “white collar” duties).
• Salary Basis/level Test – the employee must be paid a predetermined and fixed salary that is not subject to reduction because of variations in the quality or quantity of work performed.
• The employee must be paid $58,656 or more annually.
• Must satisfy an overtime assessment.
• Must have an updated job description.
• Must have Senior VP and Strategic Hiring Committee approval.
• Applies to each position individually based on duties and responsibilities.

The types of duties/exemption tests shown below are:

• Executive Exemption Test
• Professional “Learned” Exemption Test
• Professional “Creative” Exemption Test
• Administrative Exemption Test
• Outside Sales Exemption Test
• Computer worker Exemption Test

Based on primary job duties, not job title

most important duties that account for 50% of time spent working

Paid on a salaried basis for the job, not the number of hoursworked

• Administrative Exemption Test
  • Primary duty must be office or non-manual work; and
  • Directly related to management or general business operations of the employer or employer’s customers; and
  • Customarily and regularly requires the exercise of discretion and independent judgment with respect to matters of significance
    • Sample Jobs (Grants Specialist, HR Generalist, Internal Auditor, Budget Analyst, Accountant, Resident Directors, Admissions counselors, some supervisors)
• Professional Exemption Test . . . Learned
  • Must perform work requiring advanced knowledge in a field of science or learning; and
  • The advance knowledge must be customarily acquired by a prolonged course of study/specialized instruction.
  • Predominantly intellectual
    • Sample Jobs (Physician, Nurse Practitioner, Architect, Lawyer, Engineers, Athletic Trainers (certified), Clinical Social Worker, Chefs (4-yr degree program))
• Executive Exemption Test
  • Primarily manages a division, department or subdivision; and
  • Directs the work of two or more full-time employees
  • Must have the authority or influence over the hiring, firing, promotion, demotion, discipline and recommendation to change employee status.
    • Sample Jobs (Vice President, AVP, Director, Assoc/Asst Director, some departmental managers.)
• Professional Exemption Test . . . Creative
  • Primary duty must be the performance of work requiring invention, imagination, originality, or talent
  • Performs work in a recognized field of artistic or creative endeavor
    • Sample Jobs (Musicians, Composers, Actors, Painters, Writers)
• Outside Sales Exemption Test
  • The employee’s primary duty must be making sales (as defined in the FLSA, see DOL fact sheet 17F), or obtaining orders or contracts for services or for the use of facilities for which a consideration will be paid by the client or customer; and
  • The employee must be customarily and regularly engaged away from the employer’s place or places of business.
    • Sample Jobs (Door to Door sales, commission based sales offsite).
• Computer Professional Exemption Test
  • Employed as a computer systems analyst, programmer, software engineer or similar skilled worker.
  • Primary duties consist of:
    • Applications of systems analysis techniques or
    • Design, development, documentation, analysis, creation, testing, or modification of computer systems or programs.
    • Design, documentation, testing, creation, or modification of computer programs related to machine operating systems.

What are the next steps of the duties/exemption test?

If you believe that your employee meets the “duties test” and you want to explore the option of making them an exempt employee.  You will need to take the following steps:

• Complete the Request for Exempt Employment Status Packet.
• Get budgetary approval to ensure salary is at or about $58,656. 

Managing Time

• All hours over 40 in the workweek are eligible for 1.5 times salary or compensatory time paid.
• All hours over 37.5 in the workweek are eligible for 1.0 times salary or compensatory time paid.
• The workweek is currently Saturday through Friday.
• Employee can’t voluntarily opt-out of getting overtime compensation.
• We will discipline repeat offender who work overtime without approval after receiving notification.
• Managers are responsible to ensure employees are working as directed & reporting time properly.
• Pay Period Calendar

Managing Overtime

Establish procedures and Expectations

• Overtime approval processes.
• Rules for working and tracking working outside of normal workday.
• Flex Time – may be used to avoid accruing overtime (within workweek).
• Overtime Compensatory Leave – May be used to reduce overtime costs.
• “Unauthorized” work performed (with or without Supervisor’s knowledge).
• Employee arrives early to work & begins working.
• Meal time if an employee is not “free” from work duties.
• If overtime is needed, complete and submit an Overtime Pre-Authorization Form for approval prior to any overtime work being performed.

Paid

• Employees who travel during the workday must be paid.
• Employees must be paid for time spent working regardless of location or time of day.  Includes after hours work from home/hotel (emails/texts/calls)

Not Paid

• Regular travel to and from work
• “Downtime” while away from home
• Time spent as a “common carrier” passenger after working hours

• Final Rule: Defining and Delimiting the Exemptions for Executive, Administrative, Professional, Outside Sales, and Computer Employees
• Press Release: Biden-Harris administration finalizes rule to increase compensation thresholds for overtime eligibility, expanding protections for millions of workers
• Frequently Asked Questions