For the screen printer and small business owner these responsibilities often fall upon you. The multiple roles we small business owners fulfill include staying informed about changes in local, state, and federal laws.
Legal Minute: How the New Labor Laws Affect Screen Printers
One important, but often neglected area, of managing a successful screen print shop is Human Resources (HR). Making sure you are in compliance with updates in the law can be cumbersome and time consuming. Especially as it often requires reading through pages and pages of dry and difficult to understand rules and regulations. That is why it is understandable that, when forced to prioritize, legal compliance issues are constantly pushed down the list. However, simply ignoring the topic does not relieve you from your responsibilities.
Recently, the U.S. Department of Labor (DOL) released new important rules regarding the Fair Labor Standard Act (FLSA). Every screen print shop owner needs to know these rules. There have been significant changes in the overtime rules for salaried employees in ways that could directly affect your screen printing business. The DOL estimates that their changes will affect at least four million workers within the first year of implementation.
Under the new law, effective December 1, 2016, salaried employees earning less than $47,476 per year are eligible for overtime pay (time and a half). Just like any hourly employees you currently have on staff. Be aware that this minimum threshold amount will automatically increase every three (3) years, starting in 2020.
Determining whether one of your employees qualifies for overtime pay (called a non-exempt employee) or is exempt from these new overtime laws, follow this simple flow chart:
Based on the chart above, employees making more than $47,476 a year become exempt from the new overtime pay rules. But only IF their job duties fall within a certain designated category, as determined by the duties test. There are numerous different duty tests an employee could fall under.
Below are some common exemptions that would likely apply to typical screen printing employees on salary.
Assuming the employee makes more than $47,476 and legally satisfies the duties test, they become exempt employees and you are not required to pay them overtime.
Production Manager: meets the exemption if he or she manages a department AND he or she regularly directs the work of at least 2 or more employees. Also,either he or she has the authority to hire and fire others, or his or her opinion on the status of other employees is of importance.
Office/Storefront Manager: meets the exemption if her office or non-manual work duties. Directly relates to the management or general business operations AND the employee exercises discretion and independent judgement for significant matters.
Graphic Artist: meets the exemption if her duties require invention, imagination, originality, or talent in artistic or creative endeavors.
The Department of Labor, Wage and Hour Division, published a Small Entity Compliance Guide that goes into greater depth on the subject.
This article was written by TAYLOR LANDESMEN
* Before becoming Vice-President at Lawson Screen & Digital Products, Inc, Taylor worked as an attorney for the State of Illinois, Department of Insurance, handling regulatory and litigation matters. During law school, he was a Senior Editor on the Journal of Law & Policy at Washington University in St. Louis School of Law.
**Disclaimer: This article does not constitute legal advice or a legal relationship. It merely provides a general description of the law. Please consult a licensed attorney regarding your specific situation.