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The Trump Effect and Business: Time Off and Overtime Rules


There is a great deal of legislation – and uncertainty – surrounding the areas of paid time off policies and overtime rules, which is why it's important for employers to stay up-to-date. Small business influencer Gene Marks gets a quick breakdown from senior compliance analyst Tammy Tyler on where these various pieces of legislation stand.

More in this employment law series: Paid time off


Full transcript:

Gene Marks: Hi, everybody. My name is Gene Marks. I write every day for The Washington Post, and I write online weekly for a bunch of other different places. I've got Tammy Tyler here. Tammy is senior compliance analyst at Paychex, and Tammy specializes in paid time off and overtime. That's like your life. That's what you do.

Tammy Tyler: It has been. That's true.

GM: That is what you do. So let's start with paid time off, right? I mean, your sort of hot take on paid time off, is this something that is reality for on a national level, on a state level? As a business owner, what should be the things that we should be thinking about when it comes to making up our policies for paid time off?

TT: It has been what I've been living, but it is uncertain right now. We are watching the federal level, but there hasn't been a lot of activity. There's bills introduced. There's certainly Trump's budget.

GM: Yep.

TT: But we are looking mostly at the state level and the local jurisdictions for the paid sick leave and the paid family leaves that employers need to be aware of.

GM: So President Trump has actually proposed doing something nationally as part of his budget, but it doesn't look like that's going to have a whole lot of legs to – There's a lot of work to do there for sure.

TT: Right.

GM: So if I was going to put together my own or revisit my paid time off policy for the coming years, because this is so important to millennials, they make up 50% of the workforce, this is a big deal, just give me some advice to what I should be thinking about doing when I adjust this?

TT: I absolutely think employers should look at their paid time off leaves at this point because they do need to incorporate the regulations that might be applicable for them. But to look at who is their work base, right? What are they looking for? A lot of people moving toward a paid time off policy that incorporates vacation and paid personal days and sick days all in one. Again, still being cognizant of the laws that might apply there.

GM: You know, an interesting part about that and we talk about millennials and addressing paid time off policies to them, but I recently just wrote about how a lot of companies, particularly manufacturers, are trying to keep older employees still involved. Because they got experience, right? And we're living longer and still out there. And they're trying to come up with innovative paid time off and flexible work schedules for them as well. So seems like a hot issue that people have to be addressing this year.

TT: Very much.

GM: Let's switch over now to overtime, right? So I don't know. I thought we were supposed to be having overtime, but wasn't there a whole overtime thing going on? What's going on with overtime, Tammy?

TT: So we had been sitting around waiting to find out what was going to happen with the injunction, which is still in place, but the –

GM: Wait, what injunction?

TT: So the injunction that stopped that overtime rule.


TT: And there were challenges by a couple of lawsuits and it was enjoined in the courts and it was appealed by the Department of Labor, where it's been sitting. But the DOL finally under President Trump's administration has responded. They are going to support the appeal. Not the salary level per se that they were looking to increase it to under Obama's administration, but the – to look for affirmation that they do have the authority as the agency that can increase those salary thresholds.

GM: Do you think they'll get that affirmation that they have the authority?

TT: I think they probably will. This was kind of a new twist to the court case.

GM: Right. So ultimately even though the overtime wages did not increase like we thought they were, and I thought it was supposed to be like $47,000 and change.

TT: It was $47,476.

GM: 47, 47. You know this better than me.

TT: Yeah.

GM: You get up to that level, you have to pay overtime to anybody making up to that level.

TT: Up to that level, yes.

GM: Up to that level. They're not supervising people. They're in an administrative role. There's a duties test as well, correct.

TT: Right.

GM: Now that's sort of on hold. So it's still at $24,000 is the level it is, but we could be seeing it going up sometime in the next year or so.

TT: That's correct. I think the DOL is going to undertake rulemaking to make some changes. They're not as high as they had under the final overtime rule, but there probably will be increases.

GM: OK, great. So takeaways here, if you got a paid time off policy you want to make sure that you are readdressing it this year. Big issue for millennials and actually older generations as well, so that's a hot topic. And pending. Tammy does not expect there to be any national legislation anytime soon, but state and locals there, right?

TT: Yes, continuing to pass those.

GM: Got to check those laws that are local. And when it comes to overtime legislation, right now the original rule is approximately 24. How much is it exactly?

TT: $23,600.

GM: $23,600, right. If you're paying anybody up to that level, they are entitled to overtime. However, we could be seeing those wages go up sometime in the next year or so, so keep a close eye on that, more closely with your experts at Paychex as well. Tammy, thank you very much for joining me. I appreciate it.

TT: Thank you, Gene.

GM: Good conversation.

This website contains articles posted for informational and educational value. Paychex is not responsible for information contained within any of these materials. Any opinions expressed within materials are not necessarily the opinion of, or supported by, Paychex. The information in these materials should not be considered legal or accounting advice, and it should not substitute for legal, accounting, and other professional advice where the facts and circumstances warrant.
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