Effective August 23, 2004, the University
will implement the new Fair Labor Standards Act (FLSA)
regulations that have been issued by the United States
Department of Labor (DOL). The new regulations update and
streamline the criteria used to determine exempt/nonexempt
status of positions. Nonexempt positions are subject to
FLSA and employees in these positions must be paid time and
one-half overtime or overtime leave if the employee actually
works greater than forty (40) hours in a workweek. The new
regulations make it more difficult for the University to
designate a position as being exempt from FLSA’s overtime
requirements. The impact of these new regulations results
in a number of classified and potentially some faculty
positions having their exemption status changed from exempt
to nonexempt.
A major change to the new regulations
is to raise the salary threshold to $455 per week, or
$23,660 annually, before an employee’s position can be
considered for qualifying as exempt. The new salary
threshold is not prorated for part-time positions. With the
exception of a few professions including teaching, all other
positions not meeting this new threshold are automatically
considered nonexempt. The new regulations also add a new
exemption test for highly compensated employees (at least
$100,000). In general, DOL has strengthened the new
regulations by clarifying the meaning of key criteria, by
providing examples, and incorporating past DOL opinion
letter rulings.
University Human Resources (UHR) has
reviewed several hundred classified job descriptions to
determine if the position’s duties and responsibilities meet
the new exemption criteria of the FLSA regulations. This
review has identified select classified positions that will
need to be changed from exempt to nonexempt. The
classified position(s) and the affected employee(s) in your
organization are indicated on the attached spreadsheet.
Effective the August 25, 2004 semi-monthly payroll, any
affected employee will be required to document all of
his/her work hours on the “University of Virginia Time
Management Form”. Schools/departments shall compensate
these employees with either time and one-half overtime pay
or overtime leave for any hours actually worked beyond forty
(40) in a workweek. UHR will also be notifying each affected
employee of his/her change in exemption status.
UHR is still reviewing certain
classified positions at Pay Band 4 and faculty non-teaching
positions whose type of work is specifically mentioned by
the new DOL regulations as well as those that may not meet
the new salary threshold. This review is ongoing and we
will be contacting schools and departments to discuss
specific positions. We will work with schools/departments to
insure that the University is compliant with the new
regulations.
UHR requests that you share this
attachment with your organization’s HRMS Timekeeper and HRMS
Specialist. They will need this information to insure that
affected employees are recording their time appropriately.
UHR is in the process of centrally changing the exemption
status of affected employees. Remember, as the employer’s
representative, any hours that you “suffer or permit” a
nonexempt employee to work must be counted as work hours.
This includes working before and after their regular
scheduled day, working during lunch breaks, working
weekends, and working at home. As the employer’s
representative you must insure that nonexempt employees do
not work beyond their regularly scheduled workweek unless
they are specifically directed to work by your management.
Normally this entails management approving overtime to be
worked in advance unless you have made other provisions on
how this is to done. Again, all hours actually worked in
excess of forty (40) in the workweek must be compensated at
time and one-half overtime rate or by overtime leave for
employee’s occupying nonexempt positions.
Additional information regarding these
new regulations can be found on DOL’s website at http://www.dol.gov/. Select the “Fairpay Overtime
Rules” in the right column. The comprehensive site includes
an online video training seminar, the preamble, the new
regulations, an economic report and forecast, fact sheets
regarding specific occupations, and other information.
UHR has based its exemption status
decisions on the review of the latest job description
(Employee Work Profiles) for your position(s). If you
believe that the exemption status of your attached
position(s) should not be changed to nonexempt, please
contact Dave Ripley, Director of Compensation Management at
924-4373 or by e-mail at dwr@virginia.edu. You will need to provide
documentation explaining your position. UHR will review the
new information and determine the appropriate FLSA exemption
status consistent with the new regulations. Dave is also
available to answer any specific questions you may have
regarding the new regulations or this correspondence. Later
next week, we will be sending information to Timekeepers and
HRMS Specialist alerting them to this change as well.
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