Get Ready for Changes To the Fair Labor Standards Act (FLSA)
(Editor’s Note: Today’s post is brought to you by our friends at the Society for Human Resource Management (SHRM). With over 300,000 HR and business executive members, SHRM creates better workplaces where employers and employees thrive together. Don’t miss out on SHRM’s new People Analytics Conference on January 14-15, 2020 in Seattle. HR Bartender readers can get a 50% discount with the code PA20SHARLYN. Enjoy the article!)
Over the past few months, we’ve talked about the upcoming changes to the Fair Labor Standards Act (FLSA). You’ve probably already seen them, but just in case, here are a couple of those articles for your reference:
Legislative Update: New FLSA Overtime Changes Proposed
New FLSA Changes 2019 – – What You Need to Know
But that’s not really the purpose of today’s post. We’re less than 30 days out from the new FLSA changes going into effect. If your organization hasn’t put together an implementation plan, now’s the time. The first step toward putting together a good plan is finding reliable sources of information. I’d like to think you consider HR Bartender a reliable source (and I thank you).
Another reliable source is SHRM. As a member, we have access to several resources that can help us stay informed. In the case of this upcoming FLSA change, SHRM has put together a resource guide including forms, seminars, and a toolkit. A couple of weeks ago, SHRM’s Knowledge Advisors hosted an online chat about the changes. While the live chat has passed, if you want to view the archive, you can access it via the event page.
Assess Your Organization’s Readiness for Change
In addition to being equipped with good information when developing your implementation plan, it’s important to know where your organization currently stands. Are you in compliance? And if we’re not, what does it take to become compliant? So, the next logical step is to conduct an organizational readiness assessment.
As one HR pro to another, we know that when changes in the law happen, there are times when we can easily bring the organization into compliance. And then there are moments when changes in the law take a lot of conversations and convincing to bring the organization into compliance.
Wouldn’t it be great to have a tool that provided a risk assessment? You know, something that gave you an indicator of the company’s current level of compliance and if necessary, what it would take to bring the organization to full compliance. Well, I recently discovered that SHRM has a tool like that for the FLSA. The tool allows HR to understand FLSA risk by individual job profiles in addition to an overall organizational risk score.
1. ORGANIZATIONAL RISK AUDIT: The FLSA audit tool allows HR to answer some high-level questions about the executive, administrative, professional, and outside sales exemptions. And don’t worry if you don’t remember the specific legal definitions of these terms. The software has the definitions available. The organizational audit will also ask how the company handles on-call employees, breaks, training, and travel time.
After entering the information, the final report can be customized with your company logo. It will provide an overall risk rating as well as individual ratings for each area. HR can then use the report to conduct audits of individual job profiles.
2. JOB PROFILE AUDIT: The job profile audit is like the organizational one in that it takes you through a series of questions about the job. At this level, HR can add a department and even an employee’s name to the job profile audit.
Let’s say you have a job title that’s held by two different people in two different departments (i.e. administrative assistant). But their responsibilities are a little different. You want to make sure that both positions are compliant. This tool would allow you to do that. Same could be true of multiple people holding the same title in the same department. For example, the sales department might have multiple people with the title account manager. The final report will provide you with your answers as well as the determination about whether the job profile qualifies under one of the FLSA’s exemptions.
I could see SHRM’s FLSA Audit Tool being a part of a company’s readiness assessment and preparations for the upcoming changes to the FLSA. But I also asked SHRM a couple of questions about using the audit tool after the FLSA changes go into effect.
On the organizational front, HR professionals could use the software to run regular compliance audits. HR could monitor the company’s progress and share it with the senior management team. For the job profiles piece, it’s not possible to change a job classification BUT it is possible to have multiple classifications under the same title. For example, in the administrative assistant or account manager examples above, the organization could decide to have different classifications within the same title (i.e. senior account manager or administrative assistant II).
Wage and Hour FLSA Issues are Business Priorities
According to SHRM research, the top employment-related lawsuits are in the areas of workplace discrimination, employee benefits, and wage and hour claims. While the threat of lawsuits shouldn’t be our primary motivator for complying with the law, part of our responsibility as HR professionals is to manage risk. And to do the right thing by paying employees according to the law.
The FLSA Audit Tool can allow us to manage organizational risk. It can be done quickly, efficiently, and cost effectively. This allows HR to spend time on things that software can’t do – like recruiting, engaging, and retaining the best talent. For more information about SHRM’s FLSA Audit Tool, check out the demo on the SHRMStore website.
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