Around the time of last year’s convention in Salt Lake City, the Department of Labor issued a Notice of Proposed Rulemaking (NPRM) which would usher in some big changes to definition of “exempt” vs. “nonexempt” employees under the federal Fair Labor Standards Act. For those of you who don’t already know – though, given the inquiries I received pretty soon after the NPRM was issued and steadily throughout the year, many of you do – the former do not have to be paid at least a minimum wage and are not eligible for overtime pay while the latter are.

There are 3 basic criteria used to determine whether an employee is exempt or non-exempt. An exempt employee is one who: (1) is paid on a salary basis, (2) performs exempt “duties” of an executive, administrative or professional nature (all of which are defined in the FLSA), and (3) is paid at least $ 23,600 per year ($ 455 per week).

The main thrust of the NPRM is to increase the threshold under the 3rd part of this test from $ 23,600 per year ($ 455 per week) to $ 50,440 per year ($ 970) per week. The net result, of course, would be fewer people that are considered “exempt” employees under the FLSA; that’s more people who are going to be entitled to overtime pay. In fact, as one AAN member said to me “that’s got to be about 90% of the employees of AAN members, just about all of those reporters will be eligible for overtime.”

It was – and is – instantly clear that these proposed changes raise several issues related to the need to pay overtime, many of which concern journalists. For instance, unless you are going to pay a reporter overtime, how do you monitor their hours? What happens if a reporter is finishing a story on deadline and runs up against 40 hours? Does he or she stop writing until next week? What happens if that reporter is chasing a story and runs up against the deadline? Does he or she have to stop mid-conversation with a source? What about the use of Email? If a reporter can access his or her work account on a personal smart phone, are they prohibited from checking the work account if the 40 hour threshold has been reached (this is actually a separate issue being considered under the NPRM – how to deal with overtime in the age of technology)?

I’ve explored these and other issues related to the NPRM in a blog post I wrote for my law firm’s “Commlawblog”. As I explain in that post, we are moving toward final rules, though it is uncertain how closely the final rule will track to the rule proposed back in July 2015.

We know that a Final Rule has been sent from the Department of Labor to the Office of Management and Budget (OMB), which must review all final rules before they are published in the Federal Register. The OMB has 90 days from March 14, 2016 to approve the rule and publish it in the Federal Register (though it can ask for an additional 30 days to complete that review if necessary). The rule is likely going to become effective 30-60 days after publication in the Federal Register. Thus, the latest that the new rules would become effective is mid-September. They could become effective as early as mid-July – right around the AAN Convention in Austin, TX (and even earlier, if the OMB completes its review ahead of the allotted 90 days -- but, really, when does a government agency finish anything ahead of deadline).

Regardless of the timing, AAN members should take a look at my summary of the proposed rules and their likely effect on your operations. You should decide whether you want to hire (as I suggest in my post) employment counsel to walk you through any necessary changes to your HR policies. And you should keep an eye out for a follow up post on Commlawblog and here when the Final Rules are issued. Depending on the timing, we can certainly talk about this at my (likely) Legal Hotline Live! session in Austin.