Challenge
The company had 300 employees in 20 states, many of whom worked remotely. All employees were classified as exempt, even though there were various duties and job levels within the company. Based on the 2016 regulations there was a risk that as many as 175 employees would be impacted by this.
Solution
An assessment of the current FLSA classifications of a privately-held company was conducted. CCI obtained job descriptions, organizational charts, annual salaries, and additional relevant data. Managers and department heads were interviewed to ascertain primary duties and responsibilities. Job descriptions alone are not sufficient to determine if the duties test is met.
Results
The potential for fines of over $1 million in back wages and damages was reduced. About 100 employees were classified incorrectly and had to change to non-exempt. Nearly 50 correctly classified exempt employees required a salary adjustment to meet the new salary threshold. The company acknowledged the need for change management and management training. CCI developed new policies, procedures, management training and communication for the impacted employees.
