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www.landscapeirrigation.com September 2014 Landscape and Irrigation 41 administrative, professional, and outside sales employees. To qualify for exemption, employees generally must meet cer- tain tests regarding their job duties and must be paid on a salary basis at not less than $455 per week or $23,660 a year. It's this threshold that is expected to increase. Although the proposed rule has not yet been written, outside groups have recommended that the threshold be raised to $50,000 a year. This new threshold would, of course, eliminate a number of positions from the exempt classification, unless employers are willing to increase the guaranteed salary amount. Qualifying for an overtime exemption is not necessarily easy. Contrary to popular thought, job titles do not determine the exempt status for positions. In order for an exemption to apply, an employee's specific job duties and salary must meet several "tests" as defined by Department of Labor regulations. Also, under the FLSA, the definition of "primary duty" (as it relates to the Executive Exemption's requirement for an employee's primary duty to be management of the enterprise, department, or subdivision) in some cases allows an employee to be considered as "performing exempt management duties" while performing routine duties. Although this may be per- missible under federal regulations, some states have statutes that require the management time to be more than 50 percent of the employee's work time exclusive of performing routine duties. Many states have their own overtime exemptions that mirror the white collar exemptions but that have more stringent (or more lenient) "tests" to qualify. For example, California has a 50 percent rule whereby the term "primarily engaged in" means that one-half the employee's work time must be engaged in exempt work. To minimize risk, com- panies must consider both state and federal regulations and should comply with the more stringent of the two since they can be investigated by either agency. Jean Seawright, president of Seawright & Associates and PLANET's HR adviser, said, "Employers get into trouble when they get too creative with their pay plans and think that because they are generously paying employees, the method is irrelevant. Unfortunately, the opposite is true. It isn't so much the amount that matters; it's the method. If the method is noncompliant, an employer can end up paying overtime on top of already-provided generous earnings." To ensure compliance, Seawright recommends that employers arrange for comprehensive HR audits of pay practices, overtime classifications, and compensation plans. A thorough audit can help identify areas of risk and provides an opportunity to correct them before a government agency or attorney knocks at the door. No doubt, substantial changes to the federal overtime regu- lations are on the horizon. However, to implement changes in its regulations, the DOL must go through a standard rule- making process that includes publishing proposed changes for public comment. The comment period is typically 60 to 90 days. Once the comments are received and reviewed, final regulations are issued. We will let you know when they are available so you can comment. Tom Delaney, is director of government affairs at the Professional Landcare Network (PLANET). He can be reached via e-mail at TomDelaney@landcarenetwork.org. "Employers get into trouble when they get too creative with their pay plans and think that because they are generously paying employees, the method is irrelevant. Unfortunately, the opposite is true." — Jean Seawright LI