FLSA FAQs
What are the changes to the Fair Labor Standards Act (FLSA)?
In April 2024, the U.S. Department of Labor (DOL) revised a regulation that increased the salary threshold where employees are eligible to receive overtime. This was a major change to employee exemption criteria under the Fair Labor Standards Act (FLSA). The salary threshold, which has been in place since 2020, increased from $684 per week (the equivalent of $35,568 annually) to $844 per week (the equivalent of $43,888 annually).
When did the DOL last revise its overtime regulations for white collar workers?
The DOL last updated the white collar overtime regulations in September 2019. That update, which included setting the standard salary threshold test amount of $684 per week, has been in effect since August 23, 2024.
When is NMSU required to implement the changes to the overtime rules?
The effective date of the final rule is July 1, 2024.
How are these overtime rule changes going to impact NMSU?
This change poses unique challenges for colleges and universities because these institutions require a unique breadth of different types of positions which may not neatly align with the definitions outlined in the framework of the FLSA and accompanying regulations.
Organizational and Cultural Challenges: Exempt employees converted to Non-Exempt will have to track work time. This may be perceived as a step back in career progression. However, it's crucial to recognize that this adjustment does not diminish the value of your work or the significance of your contributions to NMSU. The reclassification from exempt to non-exempt status is mandated by Department of Labor regulations, ensuring compliance and providing you with the wage and hour protections guaranteed by legislation.
What is the difference between a non-exempt employee and an exempt employee?
Non-exempt employees are covered by the Fair Labor Standards Act and are entitled to overtime pay for hours worked in excess of 40 in a workweek at a rate of at least one and one-half times their regular rate of pay.
Because of their duties, responsibilities, salary basis and salary level, exempt employees are not covered by the Fair Labor Standards Act and are not entitled to receive overtime pay for hours worked in excess of 40 in a workweek. “Exempt” is not a title, but a legal classification pertaining to compensation.
How do the new regulations affect someone in a position that is already non-exempt?
The new regulations do not affect positions that are already non-exempt in any way. All supervisors and employees should use this opportunity to familiarize themselves with current NMSU overtime regulations and procedures.
My annual salary is above $844 per week, why did my position change from exempt to non-exempt?
Even though your salary is above the new minimum threshold, others with your same position classification title are not above the new threshold. While the Fair Labor Standards Act does not specifically state an employer cannot have both exempt and non-exempt employees in the same classification/job title, NMSU has made the decision to have all employees assigned to a grade 04 and below converted to non-exempt.
Does this mean I have to submit a time sheet documenting my hours worked and leave used every pay period?
Yes. Currently as an exempt employee you only document your leave usage by submitting the monthly Leave Report. Once you are changed to a non-exempt status you will record actual time worked on the standard time sheet twice a month. Non-exempt employees MUST submit a time sheet or the employee will not receive a paycheck for time worked. All hours must be reported during the pay period in which they are worked. Employees cannot “transfer” hours from one pay period to another. Please see the Time Reporting Manual – Nonexempt Employee for instructions.
Can I still work during the evening or on weekends?
Non-exempt employees must receive pay for all hours worked and must receive overtime pay for hours worked in excess of 40 in a workweek. Any work performed after normal working hours, including weekends, count towards your total hours worked. If the time worked after normal working hours accounts for more than 40 hours in that workweek (Sunday-Saturday), then you must be pre-approved, by your supervisor, to work those hours. Supervisors cannot allow employees to work more than 40 hours in one pay period and wait to report those hours in another pay period to avoid paying overtime.
What if I check my voicemails or emails after regular work hours?
Checking voicemails or emails after normal working hours is considered time worked and you must be compensated for all time worked. Therefore, you must get approval from your supervisor prior to performing work outside your normal hours.
Does overtime require preapproval?
Yes. Employees are required to obtain supervisor approval prior to working overtime. Departments are responsible and must budget for the cost of overtime.
What happens if I don’t have my overtime preapproved?
NMSU must pay an employee for all time worked and pay overtime pay for hours worked in excess of 40 in a workweek. However, working unauthorized overtime may subject the employee to disciplinary action.
Do holidays count as time worked?
Yes. Holidays recognized by NMSU are considered as time worked. Any hours worked in excess of 40 during a week with a holiday must be paid as overtime. In addition, if an employee is asked to work on a holiday, the employee would either submit the day as holiday worked and receive 2.5 times their rate of pay for the hours worked or the employee can be granted an alternative day off during that week and submit the alternate day as holiday instead. For example: The holiday is on Monday and the supervisor asks the employee to work a full shift on the holiday. If the employee also works Tuesday through Friday, the employee would enter Monday as holiday worked. However, if the employee was allowed to take Friday off as an alternative, the employee would enter regular time on Monday and holiday leave on Friday but will not enter holiday worked time on any of those days.
Does annual and sick leave count as time worked?
No, it doesn't. NMSU is required to compensate you with overtime pay for any hours worked beyond 40 during the workweek, even if annual or sick leave is utilized. Time considered as worked for overtime calculation excludes hours taken as sick or annual leave, as well as any leave with pay (such as compassionate leave). The only exception is Jury duty. Jury duty must be reported as regular time with NMSU as it counts toward the overtime calculation for the work week.
Can I flex my time?
Yes. An employee may request and gain supervisor approval to change the daily or weekly schedule. However, the supervisor must give equal consideration to all similarly situated employees.
Am I required to take a lunch?
Yes. Employees who work six (6) to eight (8) hours or more in the workday should have a meal break of either one (1) hour or a (1/2) hour unpaid meal break. For more information on meal breaks and rest periods please refer to the AFSCME Agreement Article 28 “Hours of Work ”.
Are non-exempt employees entitled to breaks or rest periods?
Though the FLSA does not require employers to provide breaks or rest periods for employees, NMSU allows employees to take a 15-minute rest period during each 4-hour segment of the work period. Breaks may not be taken at the beginning or the end of the work period or appended to the meal break.
Can I work less time the following week if I work more than 40 hours in the preceding week?
No. NMSU defines the work week as 12:00 a.m. Sunday through 11:59 p.m. Saturday. Any amounts worked in excess of 40 during this time period must be paid according to the FLSA requirements. If you work 43 hours in the first week of the pay period you cannot adjust your work schedule to 37 hours the following week.
How did NMSU convert my yearly salary to an hourly rate?
The hourly rate of pay for full-time employees was converted using the following formula:
Full time annual salary effective 7/1/2024, divided by 24 (or 18 for 9-month staff), divided by 86.67. For example, a full-time employee with an annual salary of $43,000 would have a converted hourly rate of $20.67.
Do I have to make-up my time if I come in late or leave early?
No. Non-exempt employees are paid for actual time worked. If you are 2 hours late for your normal work schedule start time, or leave early, you will report the hours you worked and will need to take annual or sick leave depending on the circumstances of your late arrival or early departure. If you do not have annual or sick leave accrued, you would only report the hours worked and would not be paid for the 2 hours that you did not work.
Who is entitled to overtime pay under federal law?
Most employees covered by the Fair Labor Standards Act (“FLSA”) must be paid at least one and one-half times their regular rate of pay for any hours they work beyond 40 in a workweek. An employer who requires or permits an employee to work overtime is generally required to pay the employee premium pay for such overtime work.
For additional information see the U.S. DOL Fact Sheet#22: Hours Worked Under the Fair Labor Standards Act (FLSA)
What is considered paid time?
Paid time is covered in U.S. Department of Labor Wage and Hour Division Fact Sheet#22: Hours Worked Under the Fair Labor Standards Act (FLSA)
As a leader of a department, I have employees that are becoming non-exempt as a result of being below the new threshold. I really can’t afford the cost of paying overtime what should I do .
Although you can’t make the decision to not pay overtime for hours worked over 40, you do have other ways to address the situation. We suggest you look at work practices, schedules, and resource allocation to minimize the impact of additional overtime.
As a Manager, what should I do to prepare for my employee becoming non-exempt?
Transitioning an employee from exempt to non-exempt status requires careful planning and communication to ensure a smooth transition. Here are some steps you can take as a manager to prepare for this change.
Communicate Effectively : Clearly communicate with the employee about the change in their classification from exempt to non-exempt status. Explain the reasons for the change, such as compliance with labor regulations, and address any concerns or questions they may have.
- Provide Training : Offer training on timekeeping procedures and compliance with overtime regulations. Ensure that the employee understands how to accurately track their work hours, including any overtime hours worked.
- Set Expectations : Clarify expectations regarding work hours, breaks, and overtime eligibility. Discuss any changes to the employee's schedule or workload that may result from the transition to non-exempt status.
- Monitor Work Hours : Implement systems to track the employee's work hours accurately. Monitor their work hours to ensure compliance with overtime regulations and address any issues that may arise.
- Address Career Growth : Reassure the employee that the change in classification does not reflect negatively on their career progression. Discuss opportunities for growth and development within their role despite the change in status.
- Provide Support : Offer support and guidance to help the employee adjust to their new classification. Be available to answer questions and address any concerns they may have throughout the transition process.
By taking these steps, you can help ensure a smooth transition for your employees as they move from exempt to non-exempt status.
As a Manager, what should I do if I know my employee is working unapproved overtime, for example, when I see emails sent after work hours?
NMSU is required to pay for all time worked for non-exempt employees. The supervisor should have a conversation with the non-exempt employee about working outside the normal work schedule without prior approval. If this repeatedly continues after having the discussion, then consult with HRS, Office of People Relations.
How are part-time employees paid overtime?
Part-time employees are paid overtime for hours worked over 40 hour per work week.
I work part-time. Will my pay be calculated at 40 hours to determine if I am over the new threshold?
The actual weekly pay of $844per week is used to determine whether an employee is over the threshold. In other words, the 40-hour equivalent salary is not used to make this determination.
Will I still receive the same amount per paycheck?
No, because pay period hours fluctuate. If you are converted to a non-exempt compensation system, you will be paid in accordance with the Regular & Term Appointment Nonexempt Staff, Temporary Exempt & Nonexempt Staff and Student (Semi-monthly/Lag Pay) Schedule. For more information, view the schedule . You may need to review the timing and amount of all automatic withdrawals from your bank account for items like a mortgage or car payment.
Will I need to make any changes to my direct deposit?
It is not necessary to make changes to your direct deposit. If you have automatic bill payments deducted from your account, you should make any necessary arrangements with your financial institution to accommodate the change in pay cycles.
Can I offer to work on my own time without any expectation of payment?
No. Non-exempt employees must be compensated for all hours actually worked.
Can an employee decide to waive payment of overtime?
No. The overtime requirement may not be waived under any circumstances due to federal regulations.
Do I have to notify my supervisor that I need to work overtime before I actually work it?
Yes. Employees must obtain the approval of their supervisor prior to working overtime.
My grant doesn’t allow for overtime. Do I still have to pay it?
Yes. NMSU is required to comply with the FLSA and must pay overtime regardless of the source of funding.
Can a supervisor make adjustments in the schedule before overtime occurs?
No, an employee’s daily or weekly schedule shall not be changed to avoid the payment of overtime or accrual of compensatory time without the employee’s consent.
Can a supervisor force the employee to take comp time in lieu of being paid overtime?
No. In order for an employee to receive comp time in lieu of overtime pay there must be written agreement, in advance. The university shall designate two (2) opportunities each year for employees’ to elect to receive comp time for overtime hours worked, to be effective on January 1 and July 1. If the employee does not want comp time, then the employee must be paid overtime. Please refer to the AFSCME Agreement Article 28 “Hours of Work”
At what rate does an employee earn comp time?
Comp time is earned at the same rate as overtime, which is at a half-time rate. There are restrictions on the accrual and utilization of comp time. Please refer to Administrative Rules and Procedures of New Mexico State University ARP (Administrative Rules and Procedures) 7.20 Staff Overtime Pay or Comp Time and AFSCME Agreement Article 28 Hours of Work.
For example, a nonexempt employee who has elected comp time works 45 hours in a work week. The nonexempt employee will be compensated for 45 hours at the regular hourly rate and accrue 2 ½ hours of comp time.
What happens when I receive a salary increase that raises my salary above $43,888?
NMSU is implementing at the classification pay grade level. If there is a salary increase but no change in the classification pay grade, you will remain nonexempt.
Will this change affect my eligibility for benefits?
No. Your eligibility for benefits is determined by factors other than pay.
Will benefit deductions change?
No. The amount you pay for your benefits will not change; however since you will now be paid on a lag, your benefit payments are also paid on the lag. For example, you will pay for benefit coverage 7/1/2024-7/15/2024 on the 7/31/2024 paycheck. Please see 7.15 of the Administrative Rules and Procedures for details regarding benefit end dates.
Will Flexible Spending Accounts change?
No. The amount you pay for your benefits will not change; however since you will now be paid on a lag, your benefit payments are also paid on the lag. For example, you will pay for benefit coverage 7/1/2024-7/15/2024 on the 7/31/2024 paycheck. Please see 8.14 – Flexible Spending Account of the Administrative Rules and Procedures for details regarding benefit end dates.
Will going to non-exempt affect my retirement account(s)?
No. Your eligibility for retirement will not change; however, your contributions are a percentage of your gross pay, when your pay fluctuates, your contribution fluctuates as well. Questions about retirement should be directed to Benefit Services at benefits@nmsu.edu .
Will the change in pay frequency affect my sick and annual leave accruals?
No. There would only be an impact if nonexempt employees work less than full time, leave accruals will be prorated based on actual hours worked and any paid leave of absence.
Where can I find resources on the FLSA overtime rules, and NMSU Policies?
NMSU HR June 2024 Presentation
Administrative Rules and Procedures of NMSU – Rule 7.20 Staff Overtime Pay or Comp Time
Department of Labor – Final Rule: Overtime Update
Department of Labor - Final Rule: Restoring and Extending Overtime Protections
Department of Labor – Overtime Pay
Department of Labor - Fact Sheet#17A: Exemption for Executive, Administrative, Professional, Computer & Outside Sales Employees Under the Fair Labor Standards Act (FLSA)
Department of Labor - Fact Sheet #17S: Higher Education Institutions and Overtime Pay Under the Fair Labor Standards Act (FLSA)
FLSA Links
Fair Labor Standards Act (FLSA) Open Forum
Date: Wednesday 6/5/24
Time: 12:00-2:00 PM
Location: Zoom Date: Tuesday, 6/6/24
Time: 12:00-2:00 pm
Location: Zoom Date: Friday, 6/7/24
Time: 12:00-2:00 pm
Location: Zoom Date: Monday, 6/10/24
Time: 12:00-2:00 pm
Location: Zoom Date: Tuesday, 6/11/24
Time: 12:00-2:00 pm
Location: Zoom Date: Wednesday, 6/12/24
Time: 12:00-2:00 pm
Location: Zoom