The FLSA does not provide an exemption for small businesses when it comes to the overtime rules . So whether you employe two people or 200 , you ’ ll need to become familiar with these changes and remain knowledgeable as the salary levels continue to increase in the coming years . As this issue went to press , we do know of at least one legal challenge to the DOL ’ s rule . That lawsuit was filed by a group of businesses in the U . S . District Court for the Eastern District of Texas . As the case progresses , we will keep you updated . Make sure you are subscribed to our Agents NewsLine to receive the most up-to-date information . •
Sales exemption . And if they don ’ t qualify under the outside sales exemption , they may qualify under the highly compensated employee exemption , which is the last one we ’ ll address .
COMPUTER EMPLOYEE EXEMPTION
The penultimate category is the computer employee exemption . In order to qualify under this exemption , an employee must meet all of the following tests :
1 . Salary must meet or exceed the limits outlined earlier ;
2 . The individual is employed as a software engineer , computer programmer , computer systems analyst , or other similarly skilled worker in the computer field whose primary job duty is listed below : a . The application of systems analysis techniques and procedures , including consulting with users to determine hardware , software , or system functional specifications ; b . The design , development , documentation , analysIs , creation , testing , or modification computer systems or programs , including prototypes , based on and related to user or system design specifications ; c . The design , documentation , testing , creation , or modification of computer programs related to machine operating systems ; or d . A combination of the aforementioned duties , the performance of which requires the same level of skill . Please note with the computer employee exemption , the salary thresholds become a requirement , as they are with the executive , administrative , and professional categories . It is only the outside sales category that doesn ’ t have the salary threshold . I again think the computer employee exemption is one that not many agencies will have to consider , but I include it , especially as agencies grow and employ individuals to help with their hardware , software , and program needs , including their tech stack . Additional information regarding the computer employee exemption is found at https :// www . dol . gov / agencies / whd / fact-sheets / 17e-overtime-computer
HIGHLY COMPENSATED EXEMPTION
The last and final category of employees who are exempt from the DOL ’ s overtime rules is highly compensated employees . These employees perform office work , regularly perform at least one of the duties outlined in the executive , administrative , or professional employees , and are paid a minimum annual salary of $ 132,964 beginning on July 1 , 2024 . That annual salary figure increases to $ 151,164 on January 1 , 2025 . As with the minimum salary figures for the other categories , this category ’ s salary threshold will also be adjusted effective July 1 , 2027 , and then every three years thereafter .
Whew , that was a lot of information ! Again , determining which of your employees falls under which appropriate exemption is not an easy task and if your head is swimming , remember that you are not alone . The fact sheets I referenced contained a wealth of information and additional definitions of details . They are a great place to start . Consulting with an employment law attorney might also be something your agency considers .
The FLSA does not provide an exemption for small businesses when it comes to the overtime rules . So whether you employe two people or 200 , you ’ ll need to become familiar with these changes and remain knowledgeable as the salary levels continue to increase in the coming years . As this issue went to press , we do know of at least one legal challenge to the DOL ’ s rule . That lawsuit was filed by a group of businesses in the U . S . District Court for the Eastern District of Texas . As the case progresses , we will keep you updated . Make sure you are subscribed to our Agents NewsLine to receive the most up-to-date information . •
Beth Smoller is the COO & General Counsel of KAIA . A graduate of Kansas State University , Beth also received her Juris Doctor from the University of Kansas . After working for an insurance agency in Manhattan for over 13 years , Beth joined KAIA in 2018 .
16 KANSAS INSURANCE AGENT & BROKER