Changes in federal overtime rules are not the only big shift in the workplace for Illinois employers and employees.
An Illinois Supreme Court ruling and a new state law that took effect in January also have set stricter standards for employers who wish to contest unemployment benefits sought by fired workers, employment law specialists told a seminar of The Greater Springfield Chamber of Commerce on Tuesday. Approximately 70 business owners and managers attended the session at the Statehouse Inn in Springfield.
Among little noticed changes in overtime rules announced last week by the Obama administration is an automatic increase in compensation thresholds every three years based on economic conditions, said Debra Stegall, a partner in the Peoria law firm of Heyl, Roster, Voelker & Allen.
Stegall added that employers, including small businesses, should begin now analyzing rules that take effect Dec. 1, including the “duties test” that determines whether an employee is exempt from overtime after 40 hours.
“It’s going to take time to figure out who is exempt and who is non-exempt,” said Stegall. “You probably are going find some in your own organization who are misclassified.”
She pointed out that, under Illinois law, comp time is not an option for workers covered by overtime.
The state Supreme Court ruling and new state law on unemployment benefits eligibility have made written policy statements and documentation of misconduct even more important for employers, according to Daniel Simmons with the Springfield office of Heyl, Roster, Voelker & Allen.
Illinois justices ruled in favor of unemployment benefits for an American Airlines employee who was fired for providing free champagne and a seating upgrade to a friend of a friend, said Simmons, even though a state employment referee had ruled in favor of the airline.
“They concluded that, in the absence of a written policy, she could not have anticipated getting fired,” said Simmons.
The new state law clarified employee “misconduct” in areas such as falsification of job applications, failure to maintain professional licensing or certification, attendance violations, damaging employer property, refusal of employer orders, and use of drugs and alcohol.
“Is this really, really restrictive? Yes, it is,” said Simmons. “It says, you better have these (written) policies in place.”
Chamber vice president of operations Lisa Schafer said registrations for the seminar surged after announcement of the revised federal overtime rules.
“As you can see, they have a lot of questions,” said Schafer.
Changes recently announced by the U.S. Department of Labor in federal rules on payment of overtime for more than 40 hours a week take effect Dec. 31. Among the key revisions:
* Salary limit for exemption from overtime raised from $455 a week, or $23,660 annually, to $913 a week, or $47,476 annually.
* Overtime mandatory for hours worked over 40 in a seven-day week defined by the employer (comp time not an option in Illinois.)
* Revised “duties test” to determine whether an employee is exempt.
* Extends overtime coverage to an estimated 4.2 million workers.