On May 18, 2016, the Department of Labor announced its rule changes to the Fair Labor Standards Act (FLSA). The minimum salary threshold required for an employee to be considered exempt from overtime will increase from $455 per week ($23,660 annually) to $913 per week ($47,476 annually), effective December 1, 2016. Faculty and instructional staff are unaffected by this change.

The FLSA is a federal law and we are required to comply with the new rule changes. Ball State University has formed an FLSA project team who will work with senior leadership to assess the impact of this change on the University.  As decisions are finalized, we will provide you updates.

Travel Policy for Nonexempt (hourly) employees.

In order to answer questions and prepare the university for the rule changes, we have developed the following FAQ’s.

The Fair Labor Standards Act (FLSA) is the federal wage and hour law administered by the US Department of Labor. The FLSA establishes minimum wage, overtime pay and child labor prohibitions.

Exempt employees are excluded from the overtime provisions of the Fair Labor Standards Act. Exempt employees are paid on a salaried basis and must meet both a salary threshold as well as a duties test.

Non-exempt is a term used in the Fair Labor Standards Act to delineate employees who are eligible to earn overtime for all hours worked over forty (40) in a work week. Many employers refer to their non-exempt employees as hourly paid.

The salary threshold is increasing from $455 per week to $913 per week ($47,476 per year).

The change will affect a limited number of salaried professional and staff employees. Faculty are not affected by the rule change.

The salary threshold is not pro-rated for part-time work.

The salary threshold is $913 per week. As long as the ten (10) month employee is paid at least $913 per week and meets the duties test, s/he will remain exempt from overtime.

Yes. Employees who are non-exempt must report all hours worked.

No. All non-exempt employees will be paid on a bi-weekly basis.

Federal law requires that non-exempt employees earn overtime (time and a half) when they work more than forty (40) hours in a work week. However, Ball State is more generous than the federal law requires and we pay overtime if an employee reports more than forty (40) hours of straight time in a work week. The work week at Ball State University starts on Sunday and ends on Saturday.

If an employee works more than eight (8) hours in a day, s/he does not earn overtime. It is only when the employee reports more than forty (40) in a work week that s/he earns overtime. For example, a staff employee works ten (10) hours on Monday, Tuesday, Wednesday and Thursday, but does not work on Friday, s/he will not earn overtime. If this same employee reports to work on Friday and works for four (4) hours, s/he will earn four (4) hours of overtime.

If an employee works Monday for ten (10) hours, works eight (8) hours on Tuesday, Wednesday, and Thursday, and uses eight (8) hours of vacation on Friday, s/he will earn two (2) hours of overtime.  A strict application of the federal law requires that we pay the employee thirty-four (34) hours of work time, and eight (8) hours of vacation for a total of forty-two (42) hours of straight time, with no overtime owed. Nevertheless, Ball State still pays the two (2) hours at the overtime rate.

Public employers may elect to pay their employees compensatory time (aka “comp” time) in lieu of overtime. Comp time is paid time off and is earned at time and a half. For example, if a staff employee works 41 hours in a work week, s/he may be paid overtime for one hour, or be granted 1.5 hours of comp time. An employee may bank up to 240 hours and at Ball State, we pay out unused comp time in July.

No, it is at the discretion of the employer to grant either comp time or overtime. Some departments may experience slower work periods where employees could utilize comp time. However, there are some departments that are not able to grant additional time off and elect to pay the overtime.

When an employee works more than forty (40) hours in a work week, Kronos automatically defaults the time to comp time. If you do not want to grant comp time, you will need to make an adjustment. In the Totals section at the bottom of the timecard, click the amount to move and select Amount > Move. The Move Amount dialog box opens. Change the pay code, amount, effective date, or transfer an amount.

You will be paid on an hourly basis. Non-exempt professional employees will use Kronos to document all hours worked and leave time. They will be paid bi-weekly and be eligible for overtime or compensatory time for all hours reported over forty (40) in a work week.

You will be paid on an hourly basis and will be a non-exempt staff employee. Non-exempt staff employees currently use Kronos to document all hours worked and leave time. They are paid bi-weekly and are eligible for overtime or compensatory time for all hours reported over forty (40) in a work week.

No. Non-exempt professionals will have the same retirement plan options as exempt professional employees.

Yes

No. You will remain in your current pay grade.

Staff employees who are currently exempt received their sick and vacation balances up front in July. If you are currently exempt staff and become non-exempt staff as a result of the FLSA changes, you will retain your current balances. Effective the payroll period that covers July 1, 2017, your accrual method will be updated to reflect that of a non-exempt staff employee. Your unused vacation balances will move to your prior year vacation bank (you will have one year to use them) and you will begin accruing sick and vacation per pay period going forward.

November 20, 2016. The new rule is effective December 1, 2016, but the University will need to change employee statuses on the payroll that includes December 1, 2016.