Federal Updates




 

Classifying your highly compensated employees. You don’t want to make this mistake. 

First things first, Connecticut doesn’t have a “highly compensated employee” exemption. That means if you’re an employer with employees located solely in CT then this one doesn’t apply to you. 

But if you’re an employer with employees outside of CT, let’s talk. About highly compensated employees, that is. 

The Fair Labor Standards Act (FLSA) has certain overtime “exemptions.” One of those exemptions is the highly compensated employee exemption. Otherwise known as HCE. 

The Supreme Court’s recent ruling stresses the importance of correctly classifying your employees. And ensuring they meet the exemption requirements. 

Even (or especially) for individuals that are higher earners. 

In other words, just because an employee earns a high daily/hourly rate does not mean you’re off the hook for paying them overtime. 

Shipman reminds us, you’ve got to “provide employees with a reliable, predetermined compensation” for each given workweek. Without this, you won’t satisfy those overtime exemptions.  

Why it matters → This case is a great reminder that it can be easy to misstep and misclassify an employee as exempt. Especially our HCEs. After all, FLSA rules aren’t messing around. 

To our employers with employees who make a high-earner rate and have abnormal work schedules, we encourage you to read up and remember the “duties test” which can help you classify exempt employees.  

Severance agreements. There’s a new set of rules you need to follow.  

We’ve got a new decision from the NLRB (National Labor Relations Board) this week. One that affects our private-sector employers. 

The NLRB ruled to restrict what you can and can’t include within your severance agreements. 

The cannots? Confidentiality and non-disparagement provisions. 

Why it matters → We know that some provisions get included in severance agreements to protect against issues that could have business-wide ramifications. But with this new decision, the areas in which you can do so are limited.

This ups the complexity of drafting these agreements and could carry further implications for employers.

Reach out to us at BCHR with any questions you may have on this one. Or read more here.

We will continue to watch & update you each week on any new changes to employment law and HR practices. To stay up to date on what you need to know, make sure you’re subscribed to our weekly What We’re Watching Newsletter. Subscribe here. 

If you have further questions on anything above or need guidance on compliance and best practices, our team at Boss Consulting HR is here to help. Get in touch.