Associated Press

Associated Press


Small business owners are rushing to get their companies – in particular their employees – ready for an upcoming change in overtime rules.

With federal regulations that are expected to affect the paychecks of 4.2 million workers going into effect Dec. 1, human resources consultants say they’re seeing a surge in calls from owners seeking help in complying. Many business owners have procrastinated, hoping Congress might put the regulations on hold or a federal court would take a similar step in response to a lawsuit filed by a coalition of 21 states. But with five weeks to go, there’s no indication owners will get a reprieve.

Chris Williams, a Travelers executive whose job includes educating business owners about labor law compliance, recently encountered proprietors at a human resources meeting who didn’t know the law was changing.

The regulations about double to $913 a week from $455 the threshold under which salaried workers must be paid overtime. The higher level is intended to offset inflation, which has eroded the old limits. In annual pay terms, it rises to $47,476 from $23,660. But there won’t be a blanket increase for all workers whose pay falls below the new threshold – federal regulations specifically exempt some employees like computer programmers and office workers from having to be paid overtime. Many employees will become eligible for overtime work in restaurants or retail as managers or supervisors.

Owners are looking for ways to comply with the law without seeing their labor costs soar.

The regulations will affect the pay of 17 employees at Wilkinson Supply, a Raleigh, N.C.-based company that sells plumbing, kitchen and bathroom fixtures and decorative items. Five employees whose salaries are close to the new threshold have gotten raises, president Ken Wertz says. Twelve are being switched to hourly pay, with their schedules staggered so the company showroom will be staffed throughout the day.

Wertz realizes there will be times when he won’t be able to avoid paying overtime.

The regulations are creating a juggling act for some owners who need to contain costs and also maintain morale.