Salary Changes: How it could affect you
Many of the millennials have landed great opportunities. Just like most working Americans, pay is a top priority. There are some changes with salary status on the horizon. Effective December 1st this year, the working status of millions could be effected by the new Department of Labor act. If you are hovering around $47,476 or less, you will be eligible for overtime pay. There are several things to consider before your employer approaches you regarding the change even though you will not have much say in the matter.
Below the Threshold
Salary employees that are making less than $47,476 will most likely have a status change to an hourly employee. That’s right you will no longer receive the same pay for working more than 40 hours per week. Time and a half pay for the hours beyond 40 hours a week. On the surface that it is good news for many. For others, there are some adjustments to be made.
1. Monitoring your hours worked. When you come and leave work was of no big concern for salary employees. Being changed to an hourly employee will require your employer to monitor your time more closely. That may mean clocking in/out for breaks, lunch, and times away from your desk.
2. Reconsider other perks. Being a salaried employee comes with different perks and rewards. This varies by company. Review your total compensation plan and benefits to see what else may be impacted like 401K contributions.
3. Lifestyle changes.
a. The changes will give the new hourly employees more money. The work levels may not change but more income will be coming to you. Consider now what you will do with it. Investments, savings, and paying down debt may be at the top of the list.
b. Secondly, you may receive more time. For those who have been working 50 – 60 hours per week, you will get off your regularly schedule time for a change. Some employers may opt to do this in lieu of paying overtime. At any rate, you get your time back to spend with family, go to school, start your business, or improve your quality of life.
c. Less frustration and stress at work. Job clarity will sure to be a result of the new overtime changes. Roles and responsibility will be more specific. The culture change could make for a better workplace.
d. Less flexibility with your schedule. There could be less leniency for you to get the job done the way you use to. The determining factor will now be the financial impact to your hours varying per week and the perception that you are not getting enough done.
The Raise
The change can could also mean the opposite in status change; hourly to salary. Employers may opt to give employees raises to move you to the salary status. This change could require you to consider the pros and cons of being a salaried employee. Here are a few for you to consider:
1. More hours at the new salary.
2. Flexibility in your work schedule.
3. Limited pay because there is no more overtime.
4. A shift in your work – life balance.
Each employer has a different perspective and work culture. However, they are all required to follow the guidelines of the Department of Labor. Be open to the adjustments employers will offer to make the new overtime rule a benefit to all parties.
