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Overtime pay laws are changing, are you ready for them?

(EMPLOYMENT) The Department of Labor announced new laws for overtime pay; it’s definitely not too soon to make sure that you are ready for the change.

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This past September, the Department of Labor announced new laws for overtime pay. These laws take effect on January 1, 2020; so it’s definitely not too soon for your company to take a look at your employees’ salaries and make sure that you are ready for the change.

As you probably already know, the Department of Labor requires employees who make a certain salary to be paid at 1.5 their normal hourly rate any time they work more than 40 hours in a week. This most recent change has reset the minimum salary for exemption from overtime pay laws to $646 per week or $35,538 annually. If an employee makes less, you are legally required to pay at the 1.5 overtime rate if they work more than 40 hours in any given week.

This is the first change in the exemption minimum since 2004. In 2016, the Obama administration attempted to raise the minimum to $47,476, but this was struck down by the court. However, this most recent change is based on the 20th percentile of salaries, which is exactly how the Department of Labor made the calculation in 2004. Because the Department of Labor used the same method to calculate the new minimum, it is unlikely to face an opposition from the court.

The Department of Labor estimates that 1.2 million employees will become eligible for overtime pay under the rule change. Most likely to be affected are workers who put in a lot of hours for a low salary, such as managers of shops and restaurants, people who work for nonprofit organizations or political campaigns, and even some part time workers.

Suzanne Lucas at Evil HR Lady breaks down the details of the eligibility requirements, and provides great tips for businesses to make sure they are ready to comply with the new rule change as of January 1.

She recommends reviewing every employee who currently isn’t eligible for overtime to figure out whether or not they will become eligible under the new law. If a newly eligible employee is paid a salary rather than an hourly wage, you will need to divide their annual salary by 2080 (that’s 40 hours per week for 52 weeks in the year) or divide their weekly paycheck by 40 to discern the hourly rate. The employee will need to start tracking their weekly hours, and if they work more than 40, you will be required to pay them at a 1.5 rate. If the employee rarely works extra hours, their paycheck won’t change much; but if they do, you’ll end up paying them more each week than you did before.

If you know your employees work a lot of extra hours, you do, legally, have the option of lowering their hourly wages (as long as it’s above minimum wage) so that the combined overtime pay adds up to a comparable annual salary. However, this will mean your employees will take home smaller checks than before, which Lucas warns could be quite “demoralizing.” After all, the point of the rule change is to make sure that more employees get fairly compensated for all hard work they do above and beyond the minimum.

Lucas also points out that these are changes in the federal law, which sets a nationwide minimum. However, some states, such as California, already have a higher salary rate for exemption; if this is the case in your state, your payroll may not be affected. She also helpfully notes that since January 1 falls on a Wednesday, which is likely mid-pay cycle, it might be less confusing if you implement any changes in wages the week before.

Ellen Vessels, a Staff Writer at The American Genius, is respected for their wide range of work, with a focus on generational marketing and business trends. Ellen is also a performance artist when not writing, and has a passion for sustainability, social justice, and the arts.

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Business Finance

COVID-19: Governors fail renters, a 90-day rent freeze is the only option now

Independent contractors whose only sin is renting instead of owning, are facing evictions even as Governors put tiny bandaids on the situation. A 90-day freeze is the nation’s only option to avoid mass migrations or spikes in homelessness.

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2020, it seems, is the year of rebranding—even when it comes to our impromptu recession brought on by a variety of factors (but largely thanks to COVID-19). Despite the negative connotations of widespread economic disaster, some people, such as St. Louis Federal Reserve President James Bullard, are regarding this instance as “an investment in U.S. public health.”

Should we all be so optimistic? Bullard seems to think so.

To be fair, James Bullard’s “optimism” also accounts for taking a “$2.5 trillion hit” to the economy, so it’s not all sunshine and dancing unicorns (this time). However, the long-term outcome of handling this crisis correctly—a process which involves bailing out small businesses, matching wages, and contributing to rebuilding and supporting our healthcare infrastructure—will be, according to Bullard, positive.

Bullard’s optimism does come with an important message: As with pretty much anything, the simpler we can keep solutions to this problem, the better the outcome will be. We’re not off to a great start; between states’ varying responses to COVID-19 procedures and mixed congressional support for a stimulus package, the process of dealing with economic fallout has become more complicated than some—Bullard included—would consider “ideal”.

Unfortunately, there isn’t really an “ideal” outcome here that is also practical without requiring a heretofore unseen level of cooperation and cohesion between political parties and state-based cultures. In the event that we can actually pull together and actively invest, as Bullard suggests, in our infrastructure, the implications for our economy will ultimately be positive—even if only in a pyrrhic victory kind of way.

In unprecedented times of crisis—you know, like right now—a little bit of optimism doesn’t hurt. Over the course of the next few months, you’ll hear all sorts of different takes on the situation; some people—those who identify as “realists” but really just enjoy bumming people out—will actively speak out against positive attitudes, while others will avoid “getting their hopes up” because they don’t want to be disappointed.

But, if Bullard’s optimism is to be believed—and we’re choosing to think it is—you have full permission to let yourself hope, at least for now.

Remember, there are a couple of things you can do to bolster your immune system without medicine during this time. One of them involves keeping a positive outlook, and the other one is eating plenty of garlic; we’ve found that one accompanies the other.

This story was first published in our Real Estate section.

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Business Finance

Gov. Cuomo first to issue 90-day moratorium on commercial, residential evictions

(NEWS) NY Governor, Andrew Cuomo is the first state leader to put a halt to all commercial and residential payments in an effort to stem the COVID-19 crisis.

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New York Governor, Andrew Cuomo is the first state governor to put a moratorium on residential and commercial evictions in response to the COVID-19 outbreak, specifically hitting pause for 90 days in his state. This is part of a $10B relief package that includes utility payments missed during this outbreak as the state (and all states) are strained by the global pandemic.

This will not only help renters to find stable footing as so many have lost their jobs overnight, but commercial renters (like restaurants) that are worried about being evicted during a time that they were shut down by the government.

Reactions have mostly been positive, but many are still pushing for a freeze on rent, essentially rent forgiveness during this period since mortgage holders can roll their 90 days on to the end of their loan term, but renters cannot.

For many landlords, rent is their exclusive income and they have very few units, but they too will be under a mortgage freeze on their buildings under this Order, providing some relief. Not to mention Tax Day just moved from April 15 to July 15.

Meanwhile, a state group, Housing Justice for All, is calling for the rehousing of every homeless individual using emergency rent assistance and in vacant homes. They cite the risk of viral spread through the homeless shelter system, as well as viral possibilities among homeless people living on the streets.

There is no known answer in this time of being tested, but a freeze on rents and mortgages in New York will likely lead to other governors taking the same route, and renters might be able to breathe a little better soon, especially those who have lost their jobs and independent contractors whose business immediately died on the vine.

We’ll be watching for other states’ reactions to rents and mortgage payments.

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Business Finance

COVID-19: Self employed Texans get some relief benefits

(BUSINESS FINANCE) Self employed? Worried about the corona virus hurting your business? Texas says you’re STILL eligible for cash-related COVID-19 coverage!

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When I heard ‘It’s hard being your own boss’, I thought people meant employee reviews were harder to do since you have to carry both parts of a tough conversation in your home office.

Now, watching as self-employed artists, caterers, events specialists and more are struggling in the wake of the COVID-19 pandemic, the image is less ‘Ha!’ and more ‘AH!’.

It’s bad out there, y’all. And my heart goes out virtually, as per CDC guidelines. But in every viral cloud, there’s a colloidal silver lining. In the great state of Texas, that lining is: You’re probably eligible for disaster-based unemployment.

Yes, really!

Straight from the Texas Workforce Commission’s mouth: If your employment has been affected by the coronavirus (COVID-19), apply for benefits either online at any time using Unemployment Benefits Services or by calling TWC’s Tele-Center at 800-939-6631 from 8 a.m.-6 p.m. Central Time Monday through Friday.

Now how does that cover the self-employed? Simple…kinda.

You’ll need to apply through the Disaster Unemployment Assistance and then take the extra steps of providing different proof than your 9-5 friends.

Firstly, you have to prove you’re self employed. If you’ve been paying you under the table, this is where the poop hits the fan, I’m afraid. The government will need things like (any given one of these): Insurance bills, business license, a recent ad, an invoice, or sales records.

Were you just about to start your own business when all this went down? Fortunately you’re covered too, so long as you have proof of prospective self-employment, say: The deed to a building you just bought, loan documents, ‘Grand Opening’ announcements, and so forth.

For the full list of documents that suffice, visit the TWC site directly and check what proof your pudding needs.

This situation is a Corona-cluster-cussword, but there’s help out there.

Reach out. Grab it. And then wash your hands.

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