How the Health Care Reform Law Impacts Employers
by Jackson Lewis LLP
Published March 23, 2010

Declared virtually dead a month ago, the House approved on March 21 (by a 219 to 212 vote) the Patient Protection and Affordable Care Act, H.R. 3590 or the "Senate Bill." The 2,409-page Senate Bill passed in the Senate on December 24, 2009. The Senate Bill was signed into law by President Barack Obama on March 23. It already is subject to numerous states' legal challenges, including one brought by thirteen State Attorney Generals alleging the law is unconstitutional.

The House also passed on March 21 the Health Care and Education Reconciliation Act of 2010, H.R. 4872 or the "Reconciliation Bill." This Bill makes several changes to the Senate Bill. The Reconciliation Bill now heads to the Senate for debate and is expected, at this point anyway, to pass in the Senate. (It might not pass intact, however, if certain provisions are found to violate the "Byrd rule," which restricts reconciliation bill provisions to only those that impact revenue and spending or if the Senate approves any amendments to it.). Read more...

FLSA: What You Need to Know
by Samantha Byrd, HR Business Partner

The difference between exempt and non-exempt employees is who gets paid overtime and who doesn't. Not knowing the difference between these categories could cost you a lot of money. Employees who qualify as "exempt" are exempt from overtime regulations (and minimum wage laws), whereas "non-exempt" employees must be paid for every hour of overtime they work.

The federal Fair Labor Standards Act (FLSA) as well as the laws of each of the 50 states regulate what constitutes "overtime." This basic set-up has been around since the inception of the Department of Labor's Fair Labor Standards Act (FLSA) in the 1930s, but over the years things have become more complicated, especially when it comes to small business.

Many employers incorrectly believe that all salaried employees are exempt or that by paying an employee a salary, they automatically become exempt. However, just as the labels "employee" and "independent contractor" don't determine a worker's actual status in the eyes of the IRS, the same is true for exempt and non-exempt employees in the eyes of the federal and state labor departments. The legal definitions of "exempt" and "non-exempt" have much more to do with an employee's level of responsibility or his or her status as a professional.

Who Must Comply With The FLSA?
Employees must be employed by a company that falls under the FLSA. That means the organization must have a unified operation, common control and a common business purpose. This organization must also meet any one of the following criteria:

• Annual gross volume of sales made or business done is not less than $500,000 (exclusive of excise taxes at the retail level that are separately stated); or
• The organization is engaged in the operation of a hospital, an institution primarily engaged in the care of the sick, the aged, or the mentally ill who reside on the premises; a school for mentally or physically disabled or gifted children; a preschool, an elementary or secondary school, or an institution of higher education (whether operated for profit or not for profit); or
• The work being done is an activity of a public agency; or
• The organization engages in interstate commerce, the production of goods for interstate commerce, or in any closely related occupation directly essential to such production.

Exempt or Non-Exempt
It's not a question of whether an employee is salaried or hourly, but rather whether or not the employee is exempt from the FLSA or not. Typically, those that are exempt are paid salaries and those that are not exempt are paid by the hour. If it were an issue of titles, then this would be easy, but it isn't. The courts have gone by what the employee does, rather than by what they are called, to determine whether or not an employee is exempt.

Exempt Employees
By law (Section 13(a)(1) of the Fair Labor Standards Act as defined by Regulations, 29 CFR Part 541), the following employees must be exemp, according to the FLSA definition oft:

• Executives
• Administrative Employees
• Professionals (learned and creative)
• Computer Employees
• Outside Sales
• Highly Compensated Employees

Non-Exempt Employees
Covered, non-exempt workers are entitled to a minimum wage of not less than $7.25 per hour effective July 24, 2009. Non-exempt workers must be paid overtime pay at a rate of not less than one and one-half times their regular rates of pay after 40 hours of work in a workweek. On the other hand, these employees are paid only for the time they actually work.

Read more >>

• How the Health Care Reform Law Impacts Employers

• FLSA: What You Need To Know
  

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