What you need to know about new overtime rules that may affect your dental practice
The U.S. Department of Labor’s plan to increase the salary amount that determines which white-collar workers are exempt from overtime pay may make a big difference in your practice. Here's how.
The U.S. Department of Labor’s (DOL) plan to increase the salary amount that determines which white-collar workers are exempt from overtime pay may affect your practice.
The rule does not apply to dentists, notes Paul DeCamp, former administrator of the DOL’s Wage and Hour Division, but it may apply to dental practice office managers and dental hygienists.
Under the Fair Labor Standards Act, the current minimum salary threshold for overtime pay is $455 per week/$23,660 per year. DOL proposes to increase that minimum salary threshold to $970 per week/$50,440 per year, which would extend overtime to nearly 5 million U.S. white-collar workers within the first year of its implementation.
According to the Bureau of Labor Statistics (BLS), dental office managers made a median income of $77,890 a year in 2010. BLS reports that the median annual wage for dental hygienists was $71,520 in May 2014.
Although the Labor Department doesn’t plan to have a final rule until later in the year, practices should start preparing now for the coming changes, say DeCamp, who is a shareholder in the Washington, D.C., region office of Jackson Lewis P.C.
First, identify all exempt employees who have salaries below $50,440.
“For people who are close, a lot of employers may decide that it’s better to give this person a raise. People on the bubble may get bumped up [to $50,440]. It’s simpler,” he says.
But, “there will be a pain point for any employer, a point where it becomes just too great to raise an employee to the new [salary] level,” DeCamp says. “In that case, you likely need to reclassify them as non exempt.”
That can be done by converting those employees to a daily or hourly rate, he says. Whichever you decide, it’s important to implement some type of time keeping system.
More than half of dental hygienists work part-time, according to BLS. If employees are working 20 or 30 hours a week and rarely exceed 40 hours a week, “there may not be much of a change that has to happen,” according to DeCamp.
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