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What Every Business Owner Should Know About the New Federal Overtime Law

 Posted on December 00, 0000 in Overtime

Illinois business law attorneyEmployers are required to follow both local and federal employment laws, which means both should be considered when determining how to handle matters like employee benefits, pay, salary, or overtime. Specifically, there is a new federal law that employers should be aware of, particularly if they have lower salary employees. Learn more about this new law and how it could affect your business, and discover how an experienced employment law attorney can help get (or keep) your small business on track.

Low Salary Employees Now Paid Overtime

Known as the Fair Labor Standards Act, the new law is supposed to address the “eroding” 40-hour workweek and the millions of employees who are not compensated for their extra time. More specifically, the new law states that salaried employees who earn $47,500 or less are to be compensated for any overtime hours that they work. In addition, the threshold is expected to raise, yet again, by January 1, 2020 (to $51,000), and increase every three years thereafter.

Understanding the Potential Impact on Your Business

Prior to the new law, the threshold for overtime pay for salary workers was a mere $23,660. Clearly, the new threshold is a significant jump – one that small businesses may struggle to accommodate. Some businesses may also experience issues when trying to determine the best way to implement the new law without causing further harm to their company. There is also the risk of an overhead increase and profit decrease, which is likely to have the most significant effect on smaller, local businesses.

Thankfully, there are a few options for mitigating the potential issues that may arise out of the new law. For example, employers may raise an employee’s salary to avoid paying overtime. Alternatively, they can keep all salary employees who fall below the threshold at no more than a 40-hour workweek. Lastly, employers could transition the employee over to an hourly rate. All these solutions do have their potential advantages and disadvantages, so guidance from an experienced employment law attorney is highly encouraged when determining which one may be most appropriate for your small business.

Contact Our Schaumburg, IL Employment Law Attorney

If you have concerns over the new overtime law, or if you need assistance in determining how to make it work in your business, contact The Miller Law Firm, P.C. Dedicated and experienced, our Schaumburg, IL employment law attorney can examine your situation and advise you of your options. At every turn, we protect the financial future of your company. Schedule a personalized consultation to get started. Call 847-995-1205 today.


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1051 Perimeter Drive, Suite 400
Schaumburg, IL 60173
Phone: 847-995-1205

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