It has been almost four months since we reported the U.S. Department of Labor (DOL) had released its final overtime rule. But despite much publicity and speculation about its impending impact, research from Paychex indicates awareness of the rule remains low among business owners.

49% | Percentage of business owners polled who remain unaware of the final overtime rule.

Reminder of what the final rule will do

  • Raise the salary threshold of the salary at which employees are eligible for overtime pay from $455/week to $913 ($47,476 per year).
  • Expand overtime pay to 4.2 million workers.
  • Automatically update the salary threshold every three years, based on wage growth over time, increasing predictability.
  • Strengthen overtime protections for salaried workers already entitled to overtime.
  • Provide greater clarity for workers and employers.
  • The final rule will become effective on December 1, 2016.
  • The final rule does not make any changes to the duties test for executive, administrative and professional employees.

Even with December being just ten weeks away, almost half of business owners surveyed were aware of the new guidelines.

Small business owners’ awareness of the new overtime-pay rules

51% | Aware of the overtime rule
49% |
Are not aware

67% | Aware owners who think new guidelines will have little impact on their business
26% |
Aware owners who think it will have some impact
7% |
Aware owners who think it will have major impact

What are the aware business owners’ plans for responding to the rules

36% | Will reposition impacted employees to non-exempt status
21% |
Will redistribute hours to minimize overtime hours worked
7% |
Will adjust salaries to conform to the new guidelines

“This study clearly indicates there is a large contingent of business owners who are unaware of the overtime rule,” said Paychex president and CEO Martin Mucci. “These results are particularly concerning as we have every reason to believe the implications of the overtime rule will be far-reaching.”

Are you prepared for December 1?

Of the 51% of survey respondents who are aware of the guidelines

55% | Somewhat prepared
34% | Very prepared
12% | Not prepared at all

Advice for preparing

  • Download this PDF of the rule from the Department of Labor
  • Familiarize yourself with the rule
  • Determine how you may be impacted
  • Begin preparing now for full compliance
  • Determine what it will mean for future business operations


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