Money & Business

Overtime Rule is Top Concern for ASAE Members

By / Mar 7, 2016 (iStock/Thinkstock)

A recent ASAE advocacy survey found that members are most concerned with the Department of Labor’s proposed overtime rule, which could have far-reaching implications for the industry.

The Department of Labor’s forthcoming overtime rule tops the list of policy concerns for ASAE’s members, according to ASAE’s recently concluded 2016 Association Advocacy survey. More than 20 percent of survey respondents ranked the DOL overtime rule as their highest concern, with the next-highest-ranked issue being tax reform.

The proposed rule DOL released last year would require businesses to pay overtime wages to employees making $50,440 or less per year, which would be a 113 percent increase over the current threshold. In addition, the minimum salary would automatically increase each year to match the 40th percentile of the average salary earned by full-time employees in the United States.

DOL is expected to put out a final rule this year—possibly as early as July. ASAE believes the rule has the potential to dramatically reshape payroll costs, staffing decisions, and job responsibilities for America’s associations and tax-exempt sector.

ASAE’s comments to DOL argue that, to contain payroll costs from increased overtime obligations, employers would have to either lay off employees or exclude reclassified employees from telework and career growth opportunities outside of core business hours. ASAE also said the $50,440 salary threshold amounts to a “one-size-fits-all” measuring stick and that the minimum salary level for exempt employees should instead be keyed to government data on regional cost-of-living differences.

ASAE is also concerned that DOL may elect to change the duties test, which is a main component used in determining whether an employee is exempt from the Fair Labor Standards Act (FLSA). In its proposed rule last year, DOL asks whether a percentage-of-time rule should be applied to the primary duties test. DOL did not provide a concrete regulatory proposal regarding the duties test but merely asked for comments on possible changes.

The issue is one of two key issues that participants in American Associations Day will take to Capitol Hill this week when more than 200 participants from at least 35 states will participate in meetings with their elected representatives.

Other top issues prioritized this year by ASAE’s advocacy survey respondents include government attendance at association meetings, nonprofit financial disclosures on Form 990, and nonprofit political activity.

Chris Vest, CAE

Chris Vest, CAE is director of public policy at ASAE. More »

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