President Obama recently called for a review of and update to the FLSA regulations. Will this result in an immediate impact on Federal positions? Fortunately, no it won’t. However, it’s a good time for Federal managers to review existing position descriptions (PDs) and update FLSA determinations.
On March 13, 2014 President Obama issued a memorandum directing the Secretary of Labor to review the existing Fair Labor Standards Act regulations. The memorandum instructs the Secretary to update regulations regarding who qualifies for overtime protection under the Fair Labor Standards Act (FLSA or Act). Any revisions the Department of Labor (DOL) proposes will apply only to non-Federal employees, i.e., those in private sector organizations.
The FLSA contains provisions that establish minimum wage, overtime, and other protections for covered employees. The Act also includes a number of provisions that exempt certain jobs from the FLSA protections. The largest number of exemptions is made using the provisions that apply to “white collar” employees, i.e., employees who perform executive, administrative or professional work. Many believe that the President’s call for a review will result in raising the bar for exempting these kinds of positions especially those who perform executive functions such as supervising or managing other employees.
Does this call by the President to review DOL’s regulations have an immediate impact on Federal managers and employees? Fortunately, there is no immediate impact. DOL must gather input on proposed changes, draft proposed regulations, issue the draft for review and comment, and finalize regulations by making any changes needed as a result of the comments received during the review period. This is expected to take as much as two years and, perhaps, longer.
Will this call by the President to review the DOL regulations have a long term impact on Federal managers and employees? Any significant change to DOL regulations probably will impact Federal managers and employees in the future. As the U.S. Office of Personnel Management (OPM) has noted, OPM was granted authority to administer the FLSA for Federal employees. However, OPM also noted that its regulations must be consistent with the DOL regulations to maintain compliance with the terms of the Act. Thus, a significant change in DOL regulations probably will result in later changes to the OPM regulations.
While Federal managers have no immediate worries resulting for the President’s call to revise the FLSA regulations, Federal managers and their advisors can prepare for any future revisions to OPM’s FLSA regulations by taking two actions now. First is ensuring that PDs that delineate the duties and responsibilities assigned to employees are current and accurate. It is critical that PDs reflect the work the employees currently are being asked to perform. It is critical because the PD is the basic document used to make a determination about who is covered by (Nonexempt) and who is not covered by (Exempt) the FLSA. If the PD is not current and not accurate, then an incorrect FLSA determination can occur. In turn, this incorrect determination can result in law suits and grievances when employees believe they are not being paid correctly as a result of inaccurate FLSA determinations.
The second action that managers can take now: work with the Human Resources staff to review and update the FLSA determinations assigned to their PDs. This update should use the most recent OPM regulations issued in 2007. Many Federal agencies have not updated FLSA determinations in the seven years since the current regulations were issued. Now is a good time to initiate a review of FLSA determinations to ensure that the risk of incorrect determinations and incorrect overtime payments is reduced.
In summary, no immediate impacts on Federal managers and employees are expected as a result of the President’s call to review the FLSA regulations. However, this is a good time to prepare for any future impacts by ensuring that existing position descriptions are up-to-date and accurate, and that the FLSA designations are based on an application of the 2007 regulations issued by OPM. By taking these two actions, managers can be prepared when significant changes to DOL regulations bring changes to OPM regulations in the future.