Transition to Non-exempt Payroll
This brief video provides an overview of the transition from the exempt payroll to non-exempt payroll based on recent changes by the U.S. Department of Labor related to overtime eligibility.
Supervisors should use the template letter below to notify employees who will transition from the exempt to non-exempt payroll on Jan. 1, 2020, based on the new salary threshold announced by the Department of Labor.
Below are tools and resources to assist with the communication to staff members affected by the new overtime eligibility rules. If you have questions, please discuss with the Human Resources representative for your school, department or entity.
- Template Notification Letter: Transition from exempt to non-exempt
- Pay Cycle Change and Your Payroll Deductions
Timeline: Transition from Exempt to Non-exempt Payroll
|Nov. 18 - Dec. 1, 2019||Notification Letter: delivered by managers to affected staff members.|
|Dec. 23, 2020||Monthly Pay Date: last monthly paycheck for month of December.|
|Jan. 1, 2020||Deadline for Compliance with Fair Labor Standards Act's new salary threshold.|
|Jan. 17, 2020||Biweekly Pay Date: first biweekly paycheck for hours worked Jan. 1-5.|
|Jan. 31, 2020||Biweekly Pay Date: first biweekly paycheck for hours worked Jan. 6-19.|
Frequently Asked Questions
Q: How will this change impact departments?
A: This change will result in the following changes for departments:
- Supervisors must review and approve timecards submitted biweekly by staff in non-exempt positions.
- Supervisors must approve any overtime by staff in non-exempt positions in advance of the overtime hours actually being worked.
- Employees who work schedules during the second or third shift windows may be eligible for shift premiums based upon the worked time in conjunction with Duke’s premium pay policy.
- Department budgets may be affected due to increased overtime pay.
Q: Can non-exempt employees telecommute/work from home?
A: Telecommuting is a work arrangement that enables a staff member to work at home from another off-site location for all or part of the regular workweek. Telecommuting may be appropriate for only some employees and jobs and should be discussed with your manager and your entity/departmental HR team. For more information, visit the Remote Work Arrangements website.
Q: Can non-exempt employees make up time missed when severe weather is called?
A: With prior approval from the non-exempt staff member's supervisor, staff designated as delayed or reserve service may make up time within 3 months. If the staff member is away from work on an approved sick leave request the day before the severe weather policy is activated, he/she may continue to use sick leave/PTO while the policy is active.
Q: Will the new Department of Labor rule impact employees who use electronic devices, such as smartphones or laptops, for work-related purposes outside of regular work hours?
A: It is important to distinguish between tasks a staff member is required to do because a supervisor requests it and tasks a staff member may ”desire” to do simply because it is the way he/she likes to work. As a rule of thumb, work schedules, including flexible work schedules, or arrangements to work from home on occasion, need to be managed and approved by a staff member’s supervisor -- just the same as when the staff member was exempt. Whether a staff member is required to check emails or messages or perform work from home also must be managed and approved by the staff member’s supervisor. A staff member should not presume that it is permissible to do this work outside of the regular workday without prior approval from a supervisor. In addition, work performed outside of work which would result in overtime must be authorized in advance by a staff member’s supervisor because all time worked must be accounted for and recorded as “time worked.”
Q: Can I promote a staff member or reclassify a position to ensure that my staff member remains in an exempt position?
A: Salary is not the sole criteria for determining whether a position is exempt from overtime pay. The work performed must also meet the Department of Labor’s criteria for exemption from the FLSA provisions. Please consult the Human Resources representative for your unit or contact Duke Human Resource 919-684-5600.
Q: Can staff in non-exempt positions continue to attend conferences and trainings?
A: Yes, but the time could be considered work time under certain conditions such as if the training occurs during normal work hours or if it is mandatory. But voluntary participation in training is not considered work time. For more information, visit the Department of Labor website.
Q: Is travel time to attend conferences, trainings or other work-related events considered work time?
A: Time spent traveling during normal work hours is considered compensable work time. Time spent in home-to-work travel by an employee, or in activities performed by an employee that are incidental to the use of the vehicle for commuting, generally is not "hours worked" and, therefore, does not have to be paid.
Q: Can non-exempt staff travel for business-related reasons? What aspects would count as “work time”?
A: According to the Department of Labor, travel that keeps an employee away from home overnight is travel away from home. Travel away from home is clearly work time when it cuts across the employee's workday. The time is not only hours worked on regular working days during normal working hours but also during corresponding hours on nonworking days. However, the Department of Labor will not consider as work time that time spent in travel away from home outside of regular working hours as a passenger on an airplane, train, boat, bus, or automobile. For more information, visit the Department of Labor website.
Q: If staff member in a non-exempt position is on-call, does that qualify as compensable work time?
A: On-call situations vary. A staff member who is not required to remain at work but is merely required to leave word where he or she may be reached is not working while on-call. The other consideration is whether a staff member can use the on-call time for his or her own purpose. If a staff member is able to use the on-call time effectively to engage in personal activities, the time is not considered work time. However, a staff member who is on-call must be able to use the idle time for his or her own purposes or the on-call time is probably hours worked. When a staff member is on-call, all time spent responding to calls is hours worked.
Q: Does being in a non-exempt position limit a department’s ability in the use of professional development funds?
A: The classification of a position as exempt or non-exempt for overtime pay has no bearing on the use of professional development funds within a department.
Q: Are individuals in non-exempt positions allowed to participate in other opportunities that are sometimes performed outside normal work week hours such as serving on committees, collateral assignments, academic advising?
A: Work-related activities that take place during normal business hours or are not voluntary for the staff member are considered compensable work time.