Tag: overtime

Hire, Outsource, or Automate?


shutterstock_416963170The finalized updated thresholds for the Fair Labor Standards Act (FLSA) rules governing overtime were announced this week. On net, they are only slightly less damaging than was rumored last year, and — true to form with this administration — they are set to take effect December 1, 2016, less than two months before President Obama leaves office. Consider them a parting shot at any successor who, thanks in no small part to the many state and local pushes to raise the minimum wage, will doubtless have to deal with even more anemic employment.

The new rules state that anyone with a gross annual income under $47,476 from a particular job, whether considered management or not, must now be treated as an hourly worker and be paid overtime for any work over 40 hours a week. Further, the new rules automatically ratchet every three years, to make sure that at least 40 percent of all workers are always hourly. The Department Of Labor claims that this will somehow add $12 million into the economy per year (a paltry amount), but ignores how any gains will likely be eaten in added administrative costs for every business out there. This act will likely not add any jobs to the economy and, in fact, provide even more justification for businesses to automate everything they can. They have certainly made my decision to add more automation that much clearer.

As I have previously discussed, I manufacture electronics. Given the growth we have had in sales over the prior couple of years, the Surface Mount (SMT) line we put in four years ago is approaching its capacity. Right now, we only run a single shift. To alleviate our capacity problems we have four options:

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Back in the summer, the Department of Labor announced a proposed rule change to overtime / hourly wages – effectively forcing all businesses to put any employee under their arbitrary threshold (Approx $50,500) on an hourly pay scale, regardless of their exemption status.  This was targeted to start in 2016.  Is this rule actually going […]

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Obama Administration Harms Businesses Yet Again – In Overtime


wptv-overtime_1435681273773_20553280_ver1.0_640_480Perhaps you haven’t heard, but under a proposed new Department of Labor rule starting in 2016, the overtime rules are changing. Right now, a business can classify any qualifying employee (a rule unto itself) making more than $23,360 per year as a salaried employee, instead of an hourly. This lets many businesses offer flexible hours, or allow working from home, or working “as needed” to get things done. Typical examples include people answering e-mails in off hours, pulling late nights to get important projects done, or any of a near-endless array of little things that just need that extra push. This also means that businesses need not keep track of numerous time clocks, time cards, and all of the added bureaucracy required. No more.

Beginning in 2016, the Department of Labor is more than doubling the hourly salary divide to $50,440. Anyone making less than that figure must be classified as an hourly position, must use a time clock, and must be paid for any applicable overtime hours.  This will be disastrous to an already dodgy economy and hiring crisis. Let me quote from Inc. Magazine:

Time clocks. These people all have to record time. If some of your workers are remote, you’ll have to figure out a way for them to record time.