How can employers prepare for the final FLSA white-collar regulations?

The FLSA's final white-collar exemption rules, effective August 23, 2004, have an impact on virtually all employers. Here's what employers need to do to comply with the requirements:

• Identify workers who earn less than $23,660. Evaluate whether payroll costs will be best controlled by raising their salaries to retain their exempt status (provided they still meet the duties test), or by budgeting your organization's overtime needs.

• Identify employees who earn $100,000 or more. Chances are that these employees will already be classified as exempt. But previously nonexempt high earners may be exempt now.

• Conduct job analyses. Conduct comprehensive job analyses to determine which employees perform executive, administrative and professional duties, as defined by the new white-collar rules.

• Revise job descriptions. Based on those job analyses, revise position descriptions accordingly. Make sure the description truly reflects the work performed and the skills required.

• Work closely with payroll. Make sure the payroll system is updated to accurately reflect exempt/nonexempt classifications, and that overtime is paid accordingly.

• Revise your discipline policy. Ensure your disciplinary policies reflect the changes to the no-docking rule, if you elect to take advantage of this new option.

• Develop a communications strategy. You have some fairly sensitive news to convey to employees. Collaborate with your corporate communications team; how well you craft the message will be critical.

• Honor union contracts. Although some employees will be newly exempt from overtime, your organization still must comply with the terms of any bargaining agreement in effect, including overtime clauses.

• Avoid overtime overkill. Employers may now be able to require overtime from certain employees without having to compensate the extra hours. But keep in mind the strong business reasons not to impose excessive overtime demands on the workforce.

• Don't forget the status issue. Some workers will shift from exempt to nonexempt under the new rules. On paper, they should be delighted by the prospect of overtime eligibility; instead, they may simply feel demoted. Be sure to convey how valuable and integral these employees remain to your organization.

• Don't drop your guard. Employers surely want to believe that the rule revisions will ring in a new ear of reduced wage-hour litigation. That's unlikely to be the case. It's safe to assume that FLSA litigation will be a key weapon in the plaintiff lawyer's arsenal for at least the near future.