Time Tracking for Employees: Exempt vs. Nonexempt

 Small-business owners should be aware that we now have certain situations that want time tracking for employees, even when staff are paid salaries. By having a company understanding on current administration standards and proposed guidelines, small-business owners can better determine their time-tracking needs as it pertains to exempt and nonexempt workers.

Timely data for billable and non-billable activities really helps to ensure:

  • Timely payroll processing
  • Labor regulation compliance
  • Enforcement of attendance and time-off policies

Evenly important is choosing a competent attendance time tracking for employees that’s not time-consuming and cumbersome for employees. In any other case, data becomes unreliable for labor files, reporting and other jobs that depend on accuracy.

The key is reviewing what’s on the market and deciding on the best solution

Exempt vs. Nonexempt

Before creating a time tracking for employees plan, small-business owners must have a basic understanding of the difference between an exempt and nonexempt employment status as described under the Rational Labor Standards Action (FLSA). Nonexempt employees are usually hourly employees who meet certain requirements set forth by the FLSA. However, there are a few salaried personnel who are nonexempt, too. As the Department of Labor clarifies, nonexempt employees are categorized as salaried staff who earn significantly less than $455 per week or $23,660 per 12 months.

On the other hand, employees who perform exempt job duties and are paid out at no less than $455 weekly and paid on a salary basis are classified as exempt. Visit this site :Timeclockgenie.com

Overtime Matters

It is important to consider that overtime situations might occur for both exempt and nonexempt employees. Therefore, checking time remains an important business function, regardless of employment status.

For example, under the FLSA, when a nonexempt employee works more than 40 time per week, the employer must pay workers “for a price no less than time and one-half their regular rates of pay,” according to the U.S. Division of Labor. Specific states have their own overtime requirements that may necessitate more generous settlement. Timekeeping is vital because small-business owners can face compliance fines and fines if overtime is not tracked or paid correctly for their hourly employees.

On the other hand, small-business owners could find that time tracking for employees is not always necessary, specifically for salaried, exempt employees, since their pay is normally straightforward and determined by their salary. However, the business enterprise and Technology Rules Group talks about that employers may choose to provide additional compensation to employees who work beyond what the company dictates to be always a normal workweek. In this case, time traffic monitoring may be necessary, even for exempt employees.

Proposed Overtime Changes

Despite current FLSA criteria, it’s important to note that the Office of Labor just lately proposed a guideline that would increase salary level requirements for white-collar and highly paid out employees and extend overtime pay protections. That is something small-business owners should retain in head when planning time-tracking initiatives, since it could affect a greater number of employees.

Staying informed of government regulations will help you will better understand when it is necessary to keep time tracking for employees and and pay them relating to federal government and state wage and hour laws. This can help mitigate hazards to your business, but it may also help foster better decision-making that can positively have an effect on your workforce management down the road.

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