Overtime Pay: Do We Have To?

In many situations – most definitely.

This past week, the Department of Labor’s (“DOL”) new overtime regulations have been in the news. Of course, I immediately wondered how this law might impact synagogues. So I did a few things. I read a lot of material that is available on the Internet from the DOL and other organizations. And I called the Department of Labor Northern New Jersey office to ask a lot of questions.

The new regulations are as follows: as of December 1, 2016, employees who are salaried and earning less than $47,476 are entitled to overtime pay for any hours they work in a given week beyond 40. While a synagogue, and other not-for-profits are exempt organizations because the majority of their operational income is from contributions, individuals can only be exempt if they meet the following criteria:

  • The employees must be white-collar professionals as opposed to manual laborers, administrative support staff, or service workers.
  • They must be paid a salary, not per hour.
  • And they must earn as much or more as the salary threshold, which will be $47,476 annually as of 12/1/2016.

A couple of case studies illustrate this well:

1. Amy is your New Jersey synagogue’s Director of Youth Engagement. Amy’s salary is $36,000. Her job is to work with young people in middle and high school. She helps organize a group of teens to attend the NFTY Convention being held in California. The week of the convention where she escorts the group on an airplane to LA, attends the conference, and escorts them back home she works 60 hours. According to the new regulations, she would be entitled to overtime pay (at the rate of time and a half) for 20 hours (any hours worked beyond 40).

Amy organizes the middle school and high school youth groups to participate in Midnight Run, an effort to provide food and clothing to the homeless in New York City. That week, she works an extra 15 hours organizing the collection of clothing, preparation of food, and going with the young people into NYC for several hours on a cold Saturday evening in January. Amy would be entitled to time and a half for the 15 hours she worked beyond the 40.

Being responsible for the children and accompanying them across state lines, which according to the DOL person I spoke with, is a form of interstate commerce. And this makes Amy a “covered employee”.

2. Rachel is the synagogue’s office manager. Her salary is $40,000. She supervises one other support staff person (she would need to supervise at least two people to be exempt). She processes checks and credit card payments and sends out emails to the congregation. In the eyes of the DOL, credit card processing and email blasting are a form of interstate commerce and make Rachel a “covered employee”. There are often days she works an extra 45 minutes to an hour extra to keep up with her work. For any hour, over 40 after December 1, 2016, Rachel is entitled to time and a half, until her salary reaches $47,476.

The DOL is not going to be keeping a special eye out on synagogues and other houses of worship, or not-for-profit organizations, to see that they are in compliance with this law. If there is an issue, employees will have to initiate a complaint. Devising a way to keep track of hours worked by employees will be important for everyone’s sake.

One way to deal with this: increase the pay of such employees to $47,476.

Have questions? Check out the Department of Labor website and consult legal counsel.

4 comments on “Overtime Pay: Do We Have To?
  1. David
    Thank you so much for doing the leg work on this. As always I find your blog – extremely helpful and in this case saved me a tremendous amount of time and energy. I only wish we could move everyone up to $47,476! All the best
    John

    • admin says:

      Hey John,

      Always good to hear from you. I hope things are going well. Glad this was helpful!

      Best,

      David

  2. Linda says:

    Thank you for this timely and informative blog.

    • admin says:

      Hi Linda,

      Thanks so much for taking the time to read my blog and sharing your thoughts. It is greatly appreciated.

      Best,

      David

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