New overtime pay rule could affect church staff
Seth Brown, BR Content Editor
June 13, 2016

New overtime pay rule could affect church staff

New overtime pay rule could affect church staff
Seth Brown, BR Content Editor
June 13, 2016

Salaried church employees making less than $47,476 annually will likely be eligible for overtime pay if they work more than 40 hours per week, according to new federal labor protections. Although, some human resources experts believe the full scope of how the stipulations will apply to churches and religious institutions is still unclear.

The U.S. Department of Labor (DOL) recently updated the overtime regulations of the Fair Labor Standards Act (FLSA) to “simplify and modernize” the rules, which take effect Dec. 1.

The regulations will probably not entitle pastors to the time-and-a-half pay requirement, based on judicial and regulatory precedents, but many support staff may qualify.

Most non-profit organizations, including churches and other ministries, are exempt from blanket overtime pay regulations.

Yet, many non-profits have employees that qualify for individual coverage, which is based on “the nature of the particular employee’s work activities,” according to one of the department’s supplemental documents. The so-called final rule will apply to employees whose primary job activities include interstate telephone calls, invoicing, shipping or transportation.

Organizations often affiliated with churches such as preschools, institutions of higher education, hospitals and elder-care facilities are covered by FLSA protections.

Salaried “white collar” workers may be exempt from overtime pay regulations if they make more than $47,476 per year and their primary job duties are considered professional, administrative or executive.

The salary threshold will be updated every three years based on wage growth, according to the new rule.

Employers have three options for complying with overtime regulations: raise an individual’s salary above the threshold, offer appropriate overtime pay or reallocate duties to reduce the amount of overtime work.

Ryan Hutchinson, executive vice president for operations at Southeastern Baptist Theological Seminary, offered additional clarifications about compliance in a blog post.

He said employees cannot volunteer their time for the same duties for which they are paid. Employers cannot offer time off in a future week to make up for overtime – commonly called “comp time.”

In addition, time calculations must be done in a single work week (seven consecutive days), not averaged over a larger period of time.

The DOL’s action came in response to a memo issued by President Barack Obama in March 2014, directing Labor Secretary Tom Perez to revise overtime regulations.

The president said regulations “have not kept up with our modern economy” and “millions of Americans lack the protections of overtime and even the right to minimum wage.”

Current rules set the salary threshold at an outdated $23,660, covering an estimated 7 percent of full-time salaried workers, said the DOL, down from 62 percent in 1975. The new expansion covers 35 percent, according to Perez.

In a statement to the Biblical Recorder, Tim Head, executive officer for denominational and public relations for GuideStone Financial Resources, said their attorneys are “studying the regulations and determining the scope of the impact on churches and ministry organizations and will be communicating more details throughout the year.