Fair Labor Standards Act (FLSA)

Communications


May 18, 2016 - FLSA Change Announcement

Letter from Bob Lavigna

UW-Madison Colleagues,

This morning, the U.S. Department of Labor (DOL) issued substantial changes to the federal Fair Labor Standards Act (FLSA). The changes will have a major impact on our campus community by moving many of our staff from salaried to hourly employees. The changes to this federal requirement include the following key provisions:

  • Employees who earn less than $47,476 annually or $913 weekly will become eligible for overtime for any hours they work more than 40 in a work week. The current thresholds are $23,660 annually/$455 weekly,
  • The $47,476 FLSA threshold will be adjusted every three years based on 40th percentile of full-time salaried workers in the lowest-wage Census region,
  • The compliance date for these new FLSA provisions is December 1, 2016.

The general FLSA changes are described here.

In addition to the general changes, DOL included changes that will be specific to higher education. We are reviewing and analyzing these new requirements. Our initial reading is that these changes include the following:

  • Compensatory time can be provided as a substitute for overtime pay.
  • An exemption for "academic administrative personnel" who provide student support (e.g., advisors and counselors). These employees will not be subject to the salary threshold if they are paid at least the minimum of the pay range for teachers on campus. We are analyzing the language in the new rule to determine how “teachers” are defined and how this will apply to our campus.
  • Graduate and undergraduate students engaged in research or teaching will be exempt from the overtime provisions.
  • Postdoctoral researchers in the sciences who engage only in research activities and do not teach will be considered professional employees and therefore will be subject to the salary threshold for overtime. On the other hand, post-docs in the humanities whose primary duty is teaching will not be entitled to overtime. If humanities post-docs do not teach, they will be subject to the new salary threshold for overtime.

However, NIH just announced that it will increase the awards for postdoctoral NRSA recipients to levels above the new FLSA threshold.

We realize that the new post-doc language is complex and will have major implications for our campus. We are working with Legal Affairs to determine more precisely how these provisions apply to us. The specific changes for higher education are at the following link.

Several months ago, OHR formed a campus workgroup to prepare for these FLSA changes. In anticipation of this morning's announcement, the group has been discussing the steps we should take to ensure our campus complies with the new requirements. Now that the DOL rule is final, the group will move forward with a formal strategy to address the new federal requirements.

We will provide more information, including campus guidance, once the new federal regulations are fully analyzed and interpreted.

Thank you,

Bob Lavigna
Assistant Vice Chancellor - Human Resources


May 31, 2016 - FLSA Work Group Announcement

Letter from Mark Walters

Dear Colleagues,

As you know, on May 17 the U.S. Department of Labor announced a series of major changes to the administrative rules that implement the federal Fair Labor Standards Act (FLSA). The changes include raising the salary threshold for FLSA coverage to $47,476 from $23,660. This means that most employees who earn less than the new threshold must receive overtime compensation for any hours they work more than 40 in a workweek. These new rules, which go into effect on December 1, 2016, have broad implications across our campus.

The Office of Human Resources (OHR) has been anticipating sweeping changes ever since President Obama directed the Secretary of Labor to update the overtime regulations. Immediately upon hearing that changes were imminent, we formed an FLSA workgroup charged with brainstorming ideas, developing options for implementation, and creating resources and communications for the UW-Madison community. The workgroup is composed of staff from OHR, the UW Office of Legal Affairs, and the UW-Madison HR community. The workgroup members are:

  • Cheryl Adams Kadera, College of Letters and Science
  • Sierra Beckles Young, Office of Legal Affairs
  • Ann Bradshaw, Enrollment Management
  • Sarah Carroll, OHR
  • Chelsea Daley, College of Agricultural and Life Sciences
  • Laura Fisk, OHR
  • Julie Karpelenia, Office of the Vice Chancellor for Research and Graduate Education
  • Brenda Krueger, University Housing
  • Meghan Owens, OHR
  • Jennifer Regan, School of Pharmacy
  • Sara Rostolder Mandell, OHR
  • Kristen Vieth, School of Medicine and Public Health
  • Mark Walters, OHR
  • George Watson, Office of Quality Improvement
  • Holly Weber, Intercollegiate Athletics

To date, the workgroup is developing a project plan in light of the December 1 implementation date. Workgroup members are drafting a communications plan, updating the OHR FLSA website with FAQs and other information, and creating resources for "FLSA Champions." (The Champions are a group formed during HR Design that includes one HR representative from each division across campus. Each champion is tasked with implementing, monitoring, and educating staff on FLSA issues in her/his division.) The workgroup is also creating resources to help supervisors and principal investigators assess the impacts of compliance.

The workgroup led the effort to conduct focus groups to understand concerns about the rule changes, and engaged with departments and divisions to assess how the changes will ultimately affect the diverse areas of our workforce. The workgroup will use this input to inform the solutions we will need to implement in order to comply with the new federal rules.

The FLSA rule changes were previewed for all employees in "Inside UW-Madison" (one week before the final changes were announced), and were also featured on "working.wisc.edu" and in the new "Working at UW" email digest. We will continue to update these media, as well as the OHR FLSA website, as more information is available.

Work continues as we comb through the 500+ pages of the new FLSA rules. Some of the new provisions are specific to higher education; the workgroup will be evaluating these provisions to determine how to implement them on our campus. Those provisions include the following:

  • Postdoctoral researchers (primarily in the sciences) who engage only in research and do not teach are generally subject to the overtime requirements. Some postdoctoral researchers that have a primary duty of teaching may meet the teaching exemption from the new salary threshold.
  • Certain academic administrative personnel working in student services outside the classroom (counselors, department heads and academic advisors) are exempt if they are paid at least as much as the entrance salary for teachers at their institutions.
  • Athletic coaches and their assistants are exempt if the majority of their duties involve teaching (including instructing athletes on how to perform their sport, but excluding recruiting). Athletic trainers may be exempt if they meet the salary threshold and perform professional duties.

We are carefully reviewing the final rule and working to determine the best way to bring our campus into compliance by December 1.

I look forward to updating you on our progress as we go. You can expect periodic updates but please do not hesitate to email flsa@ohr.wisc.edu if you have questions at any time.

Thanks,

Mark Walters
Director of Operations
Office of Human Resources
UW-Madison


June 30, 2016 - Update on Compliance to FLSA Rule Change

Letter from Mark Walters

Dear Colleagues,

As you know, the U.S. Department of Labor recently announced changes to the federal Fair Labor Standards Act (FLSA) rules. A new salary threshold for FLSA coverage goes into effect December 1, 2016 and the changes will have a major impact on our campus community.

The Office of Human Resources and the FLSA Work Group continue to review provisions of the new rules and are working hard to make sure the campus will comply with the new rules. The workgroup includes staff from OHR, the Office of Legal Affairs and the UW-Madison HR community. This group has identified the following principles to guide our work on creating flexible solutions for the campus:

  • The university will comply with all laws and regulations regarding FLSA consistently across the campus. Further, all options will abide by Equal Employment Opportunity Commission (EEOC) requirements including salary policies and practices without regard to age, color, disability, gender, marital status, national origin, race, religion, sexual orientation or veteran status;
  • OHR policies and procedures will serve as a baseline for compliance;
  • All options for compliance will be fiscally responsible and administratively feasible to implement and sustain, and will be informed by the practices of peer institutions;
  • Options will not result in the reduction of a current employee's base salary or fringe benefits or a change in employment category;
  • The FLSA Work Group will strive for consistent campus-wide options with room for division flexibility to meet local needs; and
  • Options for compliance will be transparent and communicated to the affected campus community.

Using these principles as a foundation, the workgroup is developing options for all units, divisions and departments to ensure we comply with the new rules. OHR will present the options to the campus community in the coming weeks. Deans and directors, in partnership with their HR teams, managers, and supervisors, will be able to consider the various options and determine what works best for their individual situations. The workgroup is focused on providing flexibility to the diverse work units we have on campus while ensuring the options are applied consistently across campus.

OHR has also been working closely with key units highly affected by the impending changes to the FLSA rule, including Research and Sponsored Programs (RSP), the Office of Postdoctoral Studies and the Office of Undergraduate Advising. Specifically:

  • The new minimum salary threshold will have a large impact on our grants. RSP has been engaged since the beginning of our review and is partnering with OHR to communicate with our principal investigators. OHR presented the pending changes to the college/school research administrators. RSP developed a list of frequently asked questions related to federal grants and the minimum salary threshold change (posted here).
  • The Director of Office of Postdoctoral Studies, Imogen Hurley, will work with the FLSA Work Group to examine the potential impact of the changes on our Post-Degree Training (formerly Employees-In-Training) positions. Specific titles to be affected include Research Associates, Postdoctoral Fellows and Postdoctoral Trainees.
  • OHR met with Wren Singer, Director of Undergraduate Advising, who has agreed to serve as a subject-matter expert on student advisors. On May 26, Wren held a Town Hall meeting to discuss changes to the minimum salary threshold and the potential impact on advisors.

I will continue to update you on our work as the December 1 compliance date approaches. As always, please do not hesitate to email flsa@ohr.wisc.edu if you have any questions or concerns.

Thanks,

Mark Walters
Senior Director of Operations
Office of Human Resources
UW-Madison


September 12, 2016 - Update on Compliance Recommendations

Letter from Mark Walters

Dear Colleagues,

I begin this update by recognizing the excellent progress our campus is making in preparing for the December 1, 2016 change to the U.S. Department of Labor (DOL) Fair Labor Standards Act (FLSA). As you may know, the rule changes raise the salary threshold for most exempt employees to $47,476 annually ($913 weekly) from $23,660 annually.

These changes are significant for our campus because they affect approximately 3,000 positions and will prompt a move for many staff from a salaried to hourly employment status. This will have a major impact on the UW-Madison campus community in areas ranging from work scheduling to funding.

In mid-August, the Office of Human Resources (OHR) provided each division’s HR representatives with a list of potentially affected employees within their division. The list of employees included non-instructional academic staff, post-degree training staff, and exempt university staff with annual salaries of less than $47,476. Graduate student research assistants and graduate student fellows were not included on the list because they are not impacted by the new rules.

Division HR representatives are currently working closely with managers and supervisors to review the list of potentially affected employees and determine the appropriate course of action, if any, for each employee on their list. OHR has requested that each division provide its recommendations along with supporting documentation by September 16, 2016.

Potential recommendations include (but are not limited to):

  • Position is determined to meet the academic administrator exemption definition and meets the lower salary threshold of $36,054 annually and is therefore not subject to change (remains exempt), or
  • Employee's salary is raised to or above the FLSA minimum of $47,476 (remains exempt), or
  • Employee's FLSA status changes to non-exempt
    • Division can limit non-exempt work to 40 hours
    • Division can pay overtime or award compensatory time

In mid-October, employees will be notified by their division HR representatives if their employment status will change from exempt to non-exempt. Subsequent information and training related to recording work hours and leave will be provided for these employees. OHR has scheduled FLSA Employee Forums for October 24th, 26th and 31st. OHR will also hold a special forum for post-degree training employees on November 2nd.

I look forward to a continuing partnership between OHR and colleges, schools, and divisions. This strong partnership will help make the transition to the new FLSA regulations a smooth one. I will continue to update you on our work as the December 1st compliance date approaches. For more information, see OHR FLSA.

As always, please do not hesitate to email flsa@ohr.wisc.edu if you have any questions or concerns. Thank you for your contributions to the progress we are making together in addressing this challenging issue.

We will provide more information, including campus guidance, once the new federal regulations are fully analyzed and interpreted.

Sincerely,

Mark Walters
Interim Director - Office of Human Resources


September 16, 2016 - FLSA Threshold Changes - Effect on Post-Doctoral Employees

From: Sarah Mangelsdorf, Provost and Vice Chancellor for Academic Affairs

Laurent Heller, Vice Chancellor for Finance and Administration
Marcia Mailick, Vice Chancellor for Research and Graduate Education

As you know, the U.S. Department of Labor (DOL) issued substantial changes to the federal Fair Labor Standards Act (FLSA) requiring employers to pay employees overtime for any hours worked over 40 in a work week if they earn less than $47,476 annually or $913 weekly. The compliance date for these new FLSA provisions is December 1, 2016.

The DOL specifically addressed post-doctoral employees, stating post-doctoral researchers in the sciences who engage only in research activities and do not teach will be considered professional employees and therefore subject to the new salary threshold for overtime.

Post-doctoral employees are essential to UW-Madison's research mission. The nature of their work presents unique challenges to providing pay on an hourly basis. Challenges include the ability to track hours for atypical work schedules and funding for overtime costs when long hours are required during research cycles.

Relating to peer institutions and post-doctoral candidate competition, we have learned that most universities (11 of 15) in the Big Ten Academic Alliance have decided to raise minimum salaries for post-doctoral employees to at least $47,476. Also, the National Institutes of Health (NIH) responded to these changes by announcing an increase in the awards for post-doctoral NRSA recipients to address the threshold change. Therefore, the salaries of post-doctoral employees in many disciplines will likely need to be raised in the next one to two years due to market pressures.

Based on the nature of work for post-doctoral employees, administrative burden to track hours, potential overtime costs, and competitive factors with our peers, UW-Madison has decided to require that all full-time post-doctoral employees will have a base salary of at least the FLSA salary threshold ($47,476). Exceptions to this requirement include employees that meet other FLSA exemptions (i.e., primary duty as teacher, doctor or lawyer).

The vast majority of post-doctoral employees are appointed at a full FTE. For those post-doctoral employees under 1.0 FTE, colleges and schools must decide the appropriate course of action (e.g., upgrade FTE to meet threshold, increase salary to meet threshold or move to hourly). The Office of Human Resources can assist in this review.

Please work with your HR representatives to ensure these salary upgrades are effective December 1st or earlier for current employees.

The campus will provide bridge funding to help address potentially significant local impacts due to this change. Specifically, in both FY17 and FY18, the campus will provide one-half of the estimated cost of the adjustments. This approach should offset almost all of your costs in the current fiscal year and one-half the cost next fiscal year.

Cost estimates were based on active appointments as of August 29th in the following titles: Post Grad Trainee 1, Post Grad Trainee 2, Post-Doctoral Fellow, Post-Doctoral Trainee, and Research Associates. The population includes all appointments that are 0.80 FTE or greater and excludes positions that meet the Practitioner of Medicine exemption. The attached table shows the amount that you will be provided each year. (If you have questions regarding the Practitioner of Medicine exemption, please contact the Office of Human Resources). The Budget Office will contact you regarding transfer of funding.

Thank you for working with us to address this important issue.

Attachment

2016-17 and 2017-18 Bridge Funding to Cover FLSA Increases for Post-Degree Training Positions

Division Amount*
College of Agricultural and Life Sciences 315,784
College of Engineering 253,077
VCRGE 77,471
Teaching & Learning Collaborative 7,276
Nelson Institute 1,516
L&S 267,038
SMPH 139,752
Pharmacy 80,964
Vet Med 41,619
1,184,496

* This is the annual amount that will be transferred each year - FY17 and Fy18


October 27, 2016 - FLSA Compliance Update and Informational Sessions

Letter from Mark Walters

Dear Colleagues,

Our campus continues to move toward the December 1, 2016 implementation of the revised federal Fair Labor Standards Act (FLSA) regulations. As we near the home stretch, we are proud of the excellent collaboration, diligence and communication that has occurred on our campus to prepare and implement these new regulations. The following provides information on how the campus is proceeding to implement the changes.

Campus Impact

  • This fall, divisional human resources (HR) representatives and leaders reviewed close to 3,500 positions affected by the new FLSA regulations.
  • Approximately 2,100 employees will move to a non-exempt (hourly) FLSA status as a result of the FLSA changes.
  • Additionally, about 1,000 employees will see an increase in their salary or position percentage (FTE) and therefore remain exempt (salaried) from the FLSA overtime provisions.
  • Approximately 200 positions were determined to be exempt from the new regulations because they meet the teacher, doctor, or lawyer exemption or the position qualifies for a lower "academic administrator" salary threshold.

Campus Communication

Employees moving to non-exempt status were notified of this change by their divisional HR representatives and invited to attend an employee forum explaining the impacts (e.g., payroll, benefits, paid leave, scheduling and recording of work hours). The two forums held this week were well attended with over 175 employees participating. Details of the remaining forum are as follows:

  • Monday, October 31, 9:00 - 11:00 a.m. and 1:00 - 3:00 p.m.
    Gordon Commons, Concerto/ Sonata (seats 600)

We have also scheduled forums for supervisors, managers and principal investigators to learn about how these changes will affect employees in their units. Those forums are scheduled as follows:

  • Thursday, November 3, 1:00 - 2:30 p.m.
    Health Sciences Learning Center, Alumni Hall, Room #1306
    (Registration required)
  • Friday, November 18, 1:00 - 2:30 p.m.
    Microbial Sciences Building, Ebling Auditorium
    (Registration required)

Finally, there is a forum for affected post-degree trainee employees. That is scheduled:

For information regarding the new FLSA regulations including recordings of the supervisor and employee forum presentations, see OHR FLSA.

As always, please do not hesitate to email flsa@ohr.wisc.edu if you have any questions or concerns. Thank you for your contributions to the progress we are making together in addressing this challenging issue.

Regards,

Mark Walters
Interim Director - Office of Human Resources