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FLSA Overtime: How Institutions Are Putting Plans Into Action

August 17, 2016

Sponsored by

Ellen Fernberger,

Chief Human Resources Officer at Community

College of Philadelphia

Erik Smetana,

Assistant Vice President, Human Resources and People

Strategies Group Leader

University of Missouri System

Nerissa Morris

Vice President for Human Resources

University of Miami

Presenters

Larry Robertson

Director of Compensation and HR Systems

Oklahoma City Community College

Facilitator

Andy Brantley

President and CEO

CUPA-HR

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• Benchmarking salary, benefits, and exemption changes will be an important piece in informing your institution’s strategy going forward—not only in managing the current threshold increase but in strategizing for future planned increases

• CUPA-HR research has your benchmarking needs covered with our salary and benefits surveys, the platinum standard in higher education benchmarking

What are other institutions doing to deal with the new exemption threshold?

The New RulesWhat Do They Say?

Quick Summary of Major Changes

• New annualized salary level will be $47,476 effective December 1 (which is a Thursday)

• Automatic updates every 3 years—estimated to be $51,168 in 2020

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• Highly compensated increases from $100,000 to $134,004

• No changes to the Duties Test

Poll Question

Prior to today’s workshop, how confident are you that your institution will be in compliance with the new rule by December 1 of this year?

A. Pfff, we got this

B. Ehh, I think we’ll be okay

C. I’m going to plead the 5th

D. Your call is very important to us. You are the next customer in line. Thank you for your patience.

E. What rule announcement?

Specific Issues for Higher Ed

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• No exceptions for part-time employees

• Partial year employees can be exempt, but you MUST CAREFULLY DEFINE the partial year

Q/A

Let us know how you are handling the less than 12-month schedules.

Take a couple of moments to submit your reply via the Q/A tab. We’ll share a few of your answers with the audience. No names will be shared, just your answers, unless you want us to!


• Academic Administrative positions• Directly related to academic instruction

including:• Academic counselors and advisors• Intervention specialists who respond

to student academic issues

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Q/A

Are you planning to use the academic administrative exemption for some of your academic-focused administrative positions? If so, what type of positions?

If so, please submit your reply via the Q/A tab. We’ll share a few of your answers with the audience. No names will be shared, just your answers, unless you want us to!

Most challenging positions…

• Coaches and Assistant Coaches• Athletic Trainers• Admissions Counselors• Resident Directors• Post docs• Extension

Poll Question

What strategy has your institution decided on (or leaning toward)?

A. Still discussing; no decision

B. Restructure duties and positions

C. Retain exempt status; raise salaries

D. Transition to non-exempt status

E. Combination of the above

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Larry Robertson

Director of Compensation and HR Systems

Oklahoma City Community College

• Established in January, 1972 with classes starting in September, 1972.

• Fourth largest institution in Oklahoma and the largest single campus two year institution in the state.

• About 9,000 FTE in student headcount• 140 full time faculty• 450 full time and part time staff• 400 adjunct faculty• 250 student employees• 200 temporary employees• OCCC provides 65% of ESL classes for the state of Oklahoma

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OCCC TimelinePrior to Publishing of the Regulations

• Kept Vice President for Human Resources and the Executive Vice President informed starting in March 2014.

• Identified 135 potentially affected positions• Presented the proposed regulations to

President’s Cabinet in March 2016.• Met with individual Cabinet members and their

directors to review FLSA regulations, proposed changes and the affect on positions in their areas.

• Prepared projected costs of overtime and position upgrades.

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OCCC TimelineAfter Publishing of the Regulations

• Revised list of affected positions to 88 positions.• Met with individual cabinet members and their directors to

formulate strategy for affected positions in their areas.• Collaborate with the Employment Team to identify steps to

accomplish the changes• Collaborate with the Professional Development Team and

Marketing/Public Relations to develop communication strategy.– Includes training of supervisors in regard to FLSA & time keeping

responsibilities– Communication to employees to educate them in regard to FLSA, time

sheets and to minimize morale issues

• Collaborate with IITS to develop time keeping systems.• Review policies and procedures

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OCCCAnalysis of Affected Positions

• 88 Positions affected• Expected Outcomes

– Reclassify to remain exempt• 13 positions

– Change to non-exempt• 65 positions

– Remain exempt under academic exemption• 6 positions

– Remain exempt under outside sales exemption• 1 position

– Un-determined action to be evaluated• 3 positions

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OCCCAnalysis of Affected Positions

• Positions changing from exempt to non-exempt include:– Child Development Teachers

– Admissions Outreach Advisors

– Academic Advisors

– Financial Aid Advisors

– Lab Supervisors

– Various coordinators and specialists across campus

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OCCCChallenges

• Dual Employment Policy

• Campus Culture Change regarding time keeping

• Travel

• Educate supervisors regarding the FLSA and time keeping responsibilities

• Identical positions that span the threshold

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Poll QuestionThere are two positions that have identical job descriptions. One incumbent makes $42,000 and the other incumbent makes $51,000. Other than the salary, the positions pass the duties test to be exempt positions.

What is your recommended action?

A. Make both positions non-exemptB. Make the lower paid incumbent non-exempt and keep the

higher paid incumbent exemptC. Reclassify the lower paid incumbents position to remain

exempt and give a salary increase to that incumbent

OCCCDraft Plan

• Notify affected employees by October 2, 2016

• Training sessions for supervisors and employees

• Update position descriptions in the OCCC position management system

• Update positions in OCCC ERP system and update employee wage records

• Complete transition by December 1, 2016

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Nerissa Morris,

Vice President for Human Resources

University of Miami

University of MiamiFLSA Mandate

Action Plan and Communication Tools

Nerissa E. MorrisVice President, Human Resources

Nerissa E. Morris

Vice President, Human Resources

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The University of Miami is a vibrant and diverse academic community focused

on teaching and learning, the discovery of new knowledge, and service to the

South Florida region and beyond.

Founded in 1926; four main

campuses with 15 satellite

locations across South Florida.

Footprint includes nationally recognized and award

winning Miller School of Medicine and

University of Miami Health System, home of

groundbreaking research and expert healthcare.

Annual economic

impact in local

communities, the

region, and state

of Florida.

$6Billion

11Colleges &

Schools

Faculty

2,735

Staff

11,951

Undergrads

10,200

Grads

5,000

Goals

Transparent and smooth process to comply with

mandate by December 1

Awareness and understanding among all faculty and

staff to ensure they understand the FLSA changes, as

well as departmental and individual impact

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Compensation reviews

mandate and best practice

HR works with managers to

review and confirm Job

Descriptions (JD)

JUNE - AUG SEPT OCT NOV

Classification assessment

and implementation

Report Outs – face-to-face

meetings between

managers and impacted

employees

Finalize FLSA

change

implementation

before December 1

deadline

December 1

LAUNCH

Continuous updates to faculty and staff

Action Plan - 2016

September 2016

Review final cost and

job changes with

senior leadership

Begin communication

to leadership groups

Communicate

changes to managers

for their

Communicate

resources to prepare

employees for

potential change

(FAQs, impact of

change, etc.)

November 2016

Begin mandatory

FLSA training for

all managers

Final test of

systems to ensure

compliance

(Example: system

to block exempt

employees earning

below mandate)

October 2016

Provide final report

to HR team

HR works with

managers to

communicate with

impacted

employees.

Resources targeted

to impacted

employees

Action Plan

June – August 2016

HR talking points and tip

sheet how to discuss JD

Final JD reviews by HR

provided to Central

Compensation by August

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Review any other impact

including benefits,

parking, etc.

Preliminary funding

analysis and impact

For HR - Core Job Description Review ACTIONS

Meet with managers to discuss employees potentially impacted

and review core job descriptions by August 31.

Discuss potential impact to area, which includes differences

between exempt and non-exempt jobs, agreement on core job

function, and reporting of overtime time worked.

Partner with Central Compensation to discuss core job

description review for exemption status changes and concerns.

Review by August 31

Action Plan – Job Description

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Size of Responsibility

• Does the employee truly supervise staff or are they a "lead"?

• Does the employee have the ability to hire, terminate or conduct performance evaluations?

• How many employees does the employee supervise?

Scope of Responsibility

• Does the employee have independent decision-making ability? If so, what kinds of decisions can they make independently?

• What job levels (i.e. Supv, Mgr, Dir, Provost etc.) does the employee interact with and how frequently?

• Approximately 226 job profiles and 1,500 employees may be impacted across the

University.

• We are reviewing core job descriptions in order to determine its applicability to the

employee’s role.

• If manager does not agree, then further analysis is needed to determine more

appropriate core job profile.

Job Description Further Analysis

Talking Points

Employee JD Analysis Report

Poll Question

Are you currently reviewing job descriptions with supervisors for existing exempt employees who may be impacted by the new threshold?

A. Yes (currently or completed within the past 12 months)

B. No, but confident classifications are accurate

C. No, but I am beginning tomorrow

D. I don’t know

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Poll Question

How confident are you that exempt job descriptions accurately reflect the work performed?

A. >90% (we are in good shape)

B. 50% (some limited work has been done)

C. Less than 50% (it is probably hit or miss)

D. I have no idea

Leadership - Top 200

First to Know

HR

Continuous Engagement

Managers

Training for Message Delivery

Faculty and Staff

Awareness Throughout Process

Provide awareness of the “what's changing”

throughout process

Communication Tools for

Change Management

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• Minimum Salary

• Maximum Salary

• EE % $47,476

• Population

• Occurrences

• FLSA Indicator

(Includes Comp Team

initial assessment of

duties)

• Low

• High (may be non-

exempt)

• Total $ Variances

• Counts by Dept.

• Counts Overall UM

30 - Medical Affairs UM EE Count <$47.4k

UM Total EE CountJob Profile

Min Salary

Max Salary EE % <

$47.4KPopulation Occurrences

FLSA Indicator

Total Variances EE Count

<$50.4kTotal EE Count

Accountant 38,120 63,005 65% Majority < $47.4K Multiple Low 142,368 11 15 24 37

Advanced Reg Nurse Practitioner 81,248 126,295 2%

Majority above $47.4K Widespread Low 801 2 110 2 115

Asst. Director, Annual Giving 46,000 55,000 63% Majority < $47.4K Multiple Low 19,000 0 3 5 8

Asst. Director, Career Services 46,000 57,396 70% Majority < $47.4K Moderate Low 30,441 0 1 7 10

Asst. Registrar 38,306 53,332 33%Majority above

$47.4KSemi-

Isolated Low 12,094 1 1 1 3

Asst. Scientist, SOM 53,900 85,408 3%Majority above

$47.4KSemi-

Isolated Low 35,910 2 64 2 66

Audiology Fellow 36,000 36,000 100% Majority < $47.4KSemi-


Billing Compliance Specialist 39,140 40,000 100% Majority < $47.4K

Semi-Isolated High 21,660 2 2 2 2

Biostatistician 53,900 65,863 13%Majority above

$47.4K Isolated Low 23,450 0 7 1 8

Case Manager 45,000 72,280 67% Majority < $47.4K Multiple Low 53,811 5 11 12 18

Case Worker 31,000 47,773 100% Majority < $47.4KSemi-

Isolated Low 160,549 13 13 13 13

Central Cancer Registry Specialist 38,843 55,497 75% Majority < $47.4K


Clinical Research Initiation Specialist 43,608 43,608 100% Majority < $47.4K


Communications Coordinator 38,000 43,338 100% Majority < $47.4K High 89,928 5 5 8 8

Compliance Data Analyst 40,273 49,531 100% Majority < $47.4KSemi-


Grand Total 48 240 84 296

Central

Compensation

Budget

Office

Research

Admin

Office

HR

Client

ServicesEngagement to determine funding sources

(UM has several funding sources – gifts,

revenue, grants, etc.)

Engagement to determine impact on research

grants, effort, and allowable funding changes

Central Compensation

HR Client Services

Budget Office

Research Admin Office

Leads overall University process

Serves as key partners in communicating

messages to clients (faculty and staff)

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Poll Question

Are you partnering with your central budget office and research administration (for those institutions with research grants) in order to be in compliance with the new rule by December 1 of this year?

A. Yes

B. No, and wasn’t planning on it

C. No, but I am contacting them tomorrow.

D. I don’t know

The University of Miami’s most challenging positions

Research Personnel

Post Docs

Coaches, Assistant Coaches and Trainers

Admissions Counselors

Resident Directors

Poll Question

What strategy has your institution decided on (or leaning toward) for the research personnel?

A. Still discussing; no decision

B. Restructure duties and positions

C. Retain exempt status; raise salaries

D. Transition to non-exempt status

E. Combination of the above

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Ellen W. Fernberger

Associate Vice President for Human Resources

Community College of Philadelphia

Over 70 degree and certificate programs in the arts, sciences, business, technology & liberal arts

32,000+ students and 1,700 faculty & staff

Main campus, 3 regional centers & 38 neighborhood & corporate sites

Corporate Solutions (continuing professional education, corporate training, workforce testing & training)

FT Faculty26%

PT & VL Faculty40%

Non-Exempt

18%

Exempt16%

Staffing by Employee Classification

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We knew this was coming, but hoped it would simply disappear

Now what; how do we respond:

Reviewed new requirements with Counsel

Met with the Upper Management to broadly discuss changes and potential impact

New FLSA Rules

Full-time faculty positions are unaffected

Teaching faculty are exempt under the teacher’s exemption (no minimum) (29

CFR Sec. 541.303)

Librarians, Counselors, Learning Lab - OK under two factors

Exempt because they are paid at least the entrance salary for teachers – 29 CFR sec. 541.600 (c)

Also – our librarians, counselors and learning lab are paid over $47,476

New FLSA Rules -- Faculty

Adjunct faculty are also OK

Adjunct teaching faculty are not an issue in accordance with the FLSA regs and the Teacher Exemption (29 CFR 541.303)

Part-time Librarians, Counselors, Advisors, Learning Lab – we believe also meets the Teacher Exemption; even if they do not, they will never work more than 40 hours

New FLSA Rules -- Faculty

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INVESTIGATION: Capture all non-teaching positions currently identified as exempt with threshold below the new $47,476 minimum requirement

What would it cost to increase salaries to meet the new threshold?

28 positions & ~ $90,000 + additional benefit costs (e.g., payroll taxes, retirement contribution, life & LTD premium increase)

17 of 28 (61%) are grant funded positions

Is there sufficient funding in the grants to cover the necessary increase to salary?

New FLSA Rules -- Staff

Now what? What options do we have?

College could subsidize/fund the $90,000 salary difference needed for all positions to meet the minimum threshold

Positions could be re-classified as non-exempt, and the College pays overtime

Examine other potential alternatives (e.g., fixed salary with fluctuating hours (29 CFR 778.114))

Staff Issues – Bright Ideas

Capture information about how much OT each individual typically works

Throughout the year

At peak times of the year (e.g., admissions, registration, financial aid, start/end of semester)

Calculate estimated additional cost to pay for OT vs increase salary to threshold

Staff Issues – Bright Ideas

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Evaluate these options – strengths & weaknesses

Consistency across all divisions of the campus – is that possible?

If there are areas with outliers – are these manageable?

Cost the options

Make recommendations

Example: Position with a lot of overtime (almost at threshold)

2 of 6 in one position are below the threshold

Cost to bring up to threshold = $3,000

Significant OT for these positions would cost more than $3,000

Proposed solution – increase salary to the threshold

Example: Position well below the threshold; little overtime needed

Cost to bring up to threshold = $15,000

Limited OT for these positions

Assessment – OT cost is < salary increase;

Proposal –consider fixed salary with fluctuating hours (remain salaried employees)

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Discussion at Upper Management level whether to develop a College community communication plan

Attend department/division leadership team meetings to inform & educate

After campus-wide implementation plan approved – communicate to departments with affected staff

Communication

Poll Question

Has your College or University implemented a campus-wide communication plan?

A. Yes

B. No

C. Unsure

Q/A and Follow Up Poll Question

If you answered “Yes” to the previous poll question, submit via the Q/A function the types of communications you have already prepared and who you sent the communications to (ex. impacted staff, union reps, etc.)?

If you answered “No” to the previous poll question, when do you anticipate implementing your campus-wide communications plan?

A. In the next 2 weeks

B. In the next 2 months

C. By November

D. By the effective rule date (December 1, 2016)

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Our 2 lowest salary grade minimums are below the new threshold

Need to recommend an update to the salary grade ranges & pay attention to possible salary compression

Ensure that all current grade 2 exempt staff are at or above the new proposed grade 2 range minimum

If not, what will it cost to implement that upgrade

Conduct desk audits for grade 1 exempt support positions to ensure they are all properly classified as exempt

Moving Forward

Erik Smetana,

Assistant Vice President, Human Resources and People

Strategies Group Leader

University of Missouri System

The University of Missouri System is one of the nation’s largest higher education institutions with

more than 77,000 students on four campuses

Public, land-grant, doctoral level, research university; founded in 1839

In addition to the four main campuses, the University of Missouri System also includes: A Health System comprised of mid-Missouri’s only Level 1 Trauma Center,

plus various other health centers and institutes An extension program with activities in every county of the state

Division 1 Athletics

Census Data: Students – 77,733 Staff – 17,786 Faculty – 5,937 Graduate Assistants – 4,160

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UM SYSTEM TIMELINE - overview

UM SYSTEM TIMELINE - past

Prior to DOL Announcement of New Ruling:

Played active role in commenting to the DOL on proposed ruling

Maintained high level communications regarding coming changes and potential impact with key university stakeholders

Partnered with Sibson Consulting to:

Identify operational and financial impacts

Develop strategic communications plan

Develop project plan along with related resources and tools

UM SYSTEM TIMELINE - present

Post DOL Announcement of New Ruling to Current Time:

Communication and change management

Classification assessment and strategy development for staff positions

Audit of academic positions

Best practices review

Impact analysis and cost projections

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KEY COMMUNICATIONS OBJECTIVES

Inform and educate leaders on FLSA changes and strategies for implementation

Equip HR partners and all managers/supervisors with education and tools so they may serve as informed resources and advocates for proposed changes and plans

Ensure employee understanding of the FLSA changes and recommended strategies

Prepare the university for implementing FLSA changes and related strategies and plans to come into compliance

Anticipate culture and morale implications Ensure clear, transparent and consistent communications

with respect to the FLSA initiative

COST IMPACT

STAFF FACULTY ~200 job titles with ~3,000 incumbents

were reviewed ~125 jobs with ~1,500 incumbents remain

exempt ~10 jobs with 285 incumbents will remain

exempt under the Teaching & Instructional or Academic Administrator exemption

~95 jobs will remain exempt under the standard FLSA exemption tests

~20 jobs will remain exempt and be increased a grade to accommodate

~75 jobs titles with ~1,400 will be reclassified to non-exempt

~$400,000 one-time cost to bring impacted employees to new threshold

~120 job titles with ~7,500 incumbents were reviewed

~105 jobs with ~6,800 incumbents will remain exempt ~80 jobs with 6,500 incumbents will

remain exempt under the Teaching & Instructional or Medical exemption

~25 jobs with ~250 incumbents will remain exempt under standard FLSA exemption tests ~190 of which are Post-Doc Fellows

(~$1.9MM)

~ 15 job titles with ~225 incumbents will be reclassified to non-exempt

~$3,000,000 one-time cost to bring impacted employees to new threshold

UM SYSTEM TIMELINE - future

Planned Actions Through Implementation:

Resolve significant challenges

Facilitate individualized communications for affected employees

Conduct training sessions tailored for target audiences

Review/update policies and procedures

Ensure smooth transition for employees moving from exempt to non-exempt

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UM SYSTEM – position examples

Academic Administrator Exemption Staff side Academic/Faculty

Student Life Coordinators/DirectorsWe are still evaluating how we are going to approach this population. Similar to other organizations we are considering various options.

Teaching Exemption for Non-Traditional Teaching Roles Child Development Specialist Athletic Trainers Coaches

Administrative, Facilities and Auxiliary Services Positions We are transitioning a number of our entry level HR, Finance, Accounting, etc. positions to

non-exempt. For some of our trades/auxiliary services positions we are examining the amount of

different levels we currently have and are collapsing some titles into a higher level, which will allow them to meet the salary threshold and remain in the exempt Title series.

Poll Question

After this workshop, how certain are you that your institution will be fully compliant by December 1, 2016:

A. Highly certain

B. Certain

C. Neither certain or uncertain

D. Uncertain

E. Highly uncertain

• DataOnDemand (DOD) is CUPA-HR’s hands-on application that provides your institution with direct access to confidential survey data

• With DOD, you can create custom peer groups to benchmark salary and benefits information with institutions that share things in common with yours or to aspirational comparison groups

• Right now, you can use DOD to identify, for example, the positions in your institution that are affected by the new threshold and whether the institutions in your designated comparison groups will also be struggling with decision-making around these positions or whether they already offer salaries above the threshold for these positions

• You can also begin a baseline assessment of the benefits offered by your peer institutions and whether these change next year as a result of the new rule

DataOnDemand

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• Prior to this point, positions on our Professionals Survey have largely been exempt positions

• Beginning this fall, we will collect information on our salary survey that flags the exemption status of each position (exempt or non-exempt)

• In addition, we will collect salary information for every incumbent (rather than aggregate information for each position), allowing for a more fine-grained analysis of exemption status changes

• This will allow us (and our DOD users) to benchmark on exemption status changes as well as salary changes

• To get the full benefits of benchmarking, you must participate! For more information on participating, go to http://www.cupahr.org/surveys/participation.aspx

New Salary Survey Additions This Year

FLSA Overtime: How Institutions Are Putting Plans Into Action

Thank you for attending! Don’t forget to complete the

workshop evaluation.

Sponsored by

Please submit any remaining questions about the OT rule to the group via the

Q&A tab in the webinar dashboard.

http://www.cupahr.org/surveys/participation.aspx

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Supplemental Resources

Standard Salary Level Increased By More Than 100%:

• New annualized salary level will be $47,476• This is $913/week• Less than $50,440 proposed in NPRM• Represents 40th percentile of full-time salaried workers in South (as of Q4 of

2015) in apparent nod to employers who commented on regional cost of living variations

• 4.2 million workers are now possibly eligible for OT pay

• Allows up to 10% of the minimum salary to be met by non-discretionary bonuses, incentive pay or commissions, if made at least on quarterly basis

Other Changes:

Unprecedented Decision to Automatically Update Salary Level• Beginning on January 1, 2020, the salary level required for exemption will be

automatically updated every three yearso DOL will post new salary levels 150 days before effective date

• Pegged to the 40th percentile of the lowest-wage region in the BLS data set (historically the South or Midwest) o Less disruptive than proposed annual increase and much less disruptive than

annual update based on 40th percentile • As noted during CUPA-HR’s May 25 webinar with Alex Passantino, in 2020, the salary

will increase to the estimated annualized level of $51,168o a 7.7% increase over three yearso similar increase for 2023 would reach $55,108o and a similar increase for 2026 would reach $59,351

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Highly Compensated Employee Salary Level Increased More Than $34,000

• New Highly-Compensated Salary Level will be $134,004o More than $122,100 identified in NPRMo Represents 90th percentile of full-time salaried workers

nationally as of Q4 of 2015• Requires payment on a salary basis of at least $913/week• Additional payments to bring to new level can include:

o Commissionso Nondiscretionary bonuseso End-of-year catch-up payment

No Changes to the Duties Tests• In the NPRM, DOL asked several questions regarding

the duties tests – particularly the primary duty test –but did not propose specific language

• In the Final Rule, DOL does not make any changes to the duties tests

• Nor are there any changes to the salary basis test• As under the existing regulations, there still are no

exceptions or allowances for:– part-time employees– employees of non-profits, colleges or universities, or

public entities

Employers Have Five Months to Comply

• Effective date is Thursday December 1, 2016

• Any upward salary adjustments must be in place before that date to ensure continued application of exempt status

• For bi-weekly pay, employers will need to adjust pay for pay period that includes December 1, 2016

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To Exempt or Non-Exempt – that is the question

Portland State University

https://www.dol.gov/whd/overtime/final2016/highered-guidance.pdf


https://www.pdx.edu/hr/sites/www.pdx.edu.hr/files/FLSA Exemption Test Worksheet.pdf



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Some sample institution FLSA OT sites

• http://www2.tulane.edu/wfmo/compensation/flsa.cfm

• http://www.tarleton.edu/hr/compensation/flsa-overtime-rules.html

Some specific Positions/Exempt Status

• Coaches

• Resident Directors

• Postdocs

• Academic counselors

• Admissions Counselors

Some specific Positions/Exempt Status• The Academic Administrative Exemption. The DOL, in the new Guidance for Higher

Education, reminds Colleges and Universities that it may avoid overtime for a subset of administrative employees, called "academic administrative employees" if they are paid an amount at least what the institution pays to starting teachers. This rule does not apply to all administrative employees – it applies only to those whose work is related to the teaching function. The DOL Guidance sheds some light on this distinction:

• "There are special regulatory provisions for some administrative employees—known as 'academic' administrative employees—whose primary duty is performing administrative functions directly related to academic instruction or training in an educational establishment. To be exempt, [in addition to meeting the duties tests] academic administrative employees must either be paid on a salary basis of not less than the salary level OR be paid on a salary basis at least equal to the entrance salary for teachers in the same educational establishment. To the extent that this entrance salary is below the salary level established in the Final Rule, academic administrative employees will be exempt if their salary equals or exceeds the establishment's entrance salary for teachers."

http://www2.tulane.edu/wfmo/compensation/flsa.cfm

http://www.tarleton.edu/hr/compensation/flsa-overtime-rules.html

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The Academic Administrative Exemption.• "Exempt academic administrative employees must have the primary duty of

performing administrative functions directly related to academic instruction or training. In higher education institutions, academic administrative personnel generally eligible for this exemption include department heads, academic counselors and advisors, intervention specialists who must be available to respond to student academic issues, and other employees with similar responsibilities. For example, academic counselors who perform work such as administering school testing programs, assisting students with academic problems, and advising students concerning degree requirements would satisfy the duties test for this exemption."

• "Employees who work in higher education but whose work does not relate to the educational field are not performing academic administrative work. For example, if an employee's work relates to general business operations, building management and maintenance, human resources, or the health of students and staff, the employee may meet the requirements for a different white collar exemption, but does not perform academic administrative functions."

• "To the extent that higher education institutions employ workers whose duties are not unique to the education setting, like managers in food service or at the bookstore, those employees will be covered”

Athletic coaches employed by higher education institutions may qualify for the teacher exemption.

• “Teaching may include instructing student-athletes in how to perform their sport. On the other hand, if coaches' primary duties are recruiting students to play sports or visiting high schools and athletic camps to conduct student interviews, they are not considered teachers."

• "The amount of time an employee spends instructing student-athletes is a relevant – but not exclusive factor in determining the employee's exempt status.”

– For example, assistant athletic instructors who spend more than half their time instructing student-athletes about physical health, teamwork and safety likely qualify as exempt teachers.

– In contrast, assistant coaches, for example, who spend less than a quarter of their time instructing students and most of their time in unrelated activities are unlikely to have a primary duty of teaching.

http://www.cupahr.org/knowledgecenter/files/toolkits/FLSA-Payment-Coaches-Under-Federal-Law-Whitepaper.pdf

• One difficulty members will face with a non-exempt member of a coaching staff is handling travel time.

• The FLSA addresses travel time in a variety of contexts. – For example, commuting time is expressly excluded from the hours worked by an employee.

– On the other hand, time spent traveling from place to place during the course of a day is included in the hours worked. Thus, if a non-exempt coach arrives at the office to begin paperwork or film review, then travels to the field for practice later in the day, then the time spent traveling to the field must be included in the coach’s hours worked.

• Out-of-town travel can cause particular problems. If the coach’s trip takes place in a single day – for example, a visit to an in-state recruit who lives in a town 60 miles from campus — then all of the time spent traveling will be included in the hours

worked by the coach.

– If the trip is out of town and overnight, then only those hours spent traveling during the coach’s normal working hours are included in the hours worked — unless the coach is performing work during the travel. For example, if a coach normally works from 7 a.m. to 7 p.m., and the team boards a bus to an out-of-state meet at 7:30 p.m., arriving at the hotel at 11:30 p.m., then the time spent as a passenger on the bus is not compensable.

– If the coach was reviewing team-related paperwork, preparing a game plan or watching film on his tablet, however, then the time spent doing so would be included in the hours worked.

– Similarly, if the coach was responsible for supervision of the student athletes while on the bus, then the time would be included.

• Resolution of these travel time issues will depend on a wide variety of factors, including the number of coaches for the team, the ability to assign supervisory responsibility to one (but not another) coach during the travel and the likelihood or necessity that the coach will otherwise perform work while traveling.

• In addition, in many circumstances, it may not be possible to schedule the travel outside of the coach’s normal workday, and, therefore, all of the travel time would be included in hours worked regardless of what else the coach did on the bus.


Travel Time


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Another significant problem area for non-exempt coaches is their ability to work outside of normal hours, such as accessing networks remotely and using cellphones and smart phones to communicate with others on the coaching staff, student athletes or recruits.

• These actions are all likely “work” under the FLSA and thus would need to be included in the hours worked by that coach.

• If the coach used his or her smart phone to text a recruit outside of his or her normal working hours, the time spent texting would need to be added to his or her time for the day. In addition, due to the application of some legal principles developed for a 1960s workforce, time spent waiting for a call or in between text and response may also become time that must be included in the coach’s work hours.

• Unfortunately, there are limited solutions for the remote access/cellphone issue. The coach cannot agree that he or she will not be paid for the hours spent on these tasks outside of a normal workday. The law requires that the coach be paid for those working hours — particularly if those hours would cause the coach to work more than 40 hours in the workweek.

• If an institution does not want to pay for the time, the work must not be performed. This could involve prohibiting remote access or smartphone usage, limiting the use to normal working hours, and/or crafting working hours to accommodate these tasks as part of the coach’s “normal” schedule.


Remote Access/Smart Phone

Travel Time/Remote Access

• Remember, this is relevant for other positions than just coaches


• Resident Assistants. "Student residential assistants enrolled in bona fide educational programs who receive reduced room or board charges or tuition credits from the university are not generally considered employees under the FLSA, and therefore are not subject to the FLSA's wage and hour requirements."

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• Resident Directors (who are not students)

• Resident directors can often fall under the administrative/executive exemption, but they must meet the salary threshold of $47,476.

• The DOL has said that housing does not count toward the salary.

http://blog.cupahr.org/2016/06/8-common-higher-ed-positions-likely-flsa-status-new-overtime-rule/


• Academic Counselors• Academic Counselors are defined as individuals “who perform

work such as administering school testing programs, assisting students with academic problems and advising students concerning degree requirements.” Under the 2016 regulations, academic advisors are not eligible to receive overtime pay so long as their salary is “at least as much as the entrance salary for teachers in the educational establishment at which they are employed.” Admission or enrollment counselors (also referred to as ‘officers,’ ‘advisors,’ and ‘recruiters’ in NACAC parlance) are not considered academic counselors for the purpose of these regulations, and therefore are not eligible for exemption based on salaries commensurate with entry salary for teachers. NACAC resource.


• Admissions Counselors

• Admission or enrollment counselors (also referred to as ‘officers,’ ‘advisors,’ and ‘recruiters’ in NACAC parlance) are not considered academic counselors for the purpose of these regulations, and therefore are not eligible for exemption based on salaries commensurate with entry salary for teachers. NACAC resource.


http://www.nacacnet.org/issues-action/LegislativeNews/ComplianceCenter/Documents/OvertimePayFinal2016.pdf

http://www.nacacnet.org/issues-action/LegislativeNews/ComplianceCenter/Documents/OvertimePayFinal2016.pdf

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Some specific Positions/Exempt Status: Admissions counselors (cont’d)

• In order for admissions counselors to fall under one of the standing exemptions, they will need to exercise decision making authority on recruitment and admission matters. Most admissions counselors do not exercise such decision-making authority, and therefore will likely need to either meet the salary threshold or be classified as non-exempt.



• Postdocs

• The DOL clarified that postdoctoral fellows, employees who conduct research at a higher education institution after the completion of their doctoral studies, are not considered students because they are not working towards a degree.

• Postdoctoral fellows may qualify under the professional exemption as 'learned professionals,' but they "must also satisfy the salary basis and salary level tests to qualify for this exemption." – "If a postdoctoral fellow does not primarily teach and earns less than the new

salary level, the fellow will be entitled to overtime when the fellow works more than 40 hours in a workweek."

– Of course, if the post doc does have a primary duty of teaching, then the post doc can qualify for the teaching professional exemption without complying with the salary test.

Part-Time Exempt Employees• Part-time employees (except for those that fall under the already-carved out exemptions)

that are paid below the salary threshold of $913/week are considered non-exempt by DOL.• Except for limited circumstances (doctors, lawyers, teachers, certain academic

administrators), FULL salary level is required• Means anyone earning below $47,476 is NONEXEMPT

– Track hours– Regular rate– Overtime pay

• What about “fee” basis? From a recent Q/A session during a DOL Wage & Hour Division (WHD) May 26 webinar (http://www.nacpa.org/wp-content/uploads/2016/05/New-Overtime-Rule-Webinar-QA-May-26.pdf)

– Q. You said nothing is changed in terms of paying employees on a Fee Basis. Do employees paid on a Fee Basis have to meet the criteria of one of the exemptions: executive, administrative, or executive? And, when the final rule is in place, will the fee basis pay have to equal $913 per week, rather than the current $455 per week threshold?

– A. For an employer to claim an exemption under the white collar exemption regulations (effective Dec. 1, 2016), the employee must meet the duties test under the executive, administrative, or professional exemption, and be paid not less than the minimum salary amount of $913 per week. Employees who meet the duties test under the administrative or professional exemption may also be paid on a fee basis of not less than $913 per week when the final rule becomes effective.


http://www.nacpa.org/wp-content/uploads/2016/05/New-Overtime-Rule-Webinar-QA-May-26.pdf

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Partial-Year Employees

• If an employee works nine or 10 months but is paid over 12 months and meets the salary threshold during those nine or 10 months, he or she is exempt. However (and this a big one!), these employees cannot do ANY work outside of those nine or 10 months, or they’ll have to be paid for that work, and their exempt status could be in jeopardy.

Partial-Year Employees

Example:Assume coach works a ten-month schedule, but receives paychecks over a twelve-month period.

– Amount of the checks may be prorated over the actual period of work (i.e., ten months) to determine whether she is paid at least the salary threshold.

– If a 9-month employee earns $45,000 for 9 months, but is paid over 12 months, he would meet the salary requirement because his 9-month weekly salary is $1,153.85 ($45,000/39 weeks), even though his weekly paycheck is $865.38 ($45,000/52 weeks).

– Similar calculation can be used for 10-month employees. – It is critical that the employee perform no work outside of the 9- or

10-month period.

