New provisions to the Fair Labor Standards Act qualify some college staff members for overtime pay. Announced by the U.S. Department of Labor in May, the new provision increases the threshold salary above which one is exempt from receiving overtime pay from $23,660 per year ($455 per week) to $47,476 per year ($913 per week). Now people will receive overtime pay if they make less than 47,476 instead of 23,660. This is to help more people get to a living wage. From December 16th, any staff member currently earning between $455 to $913 per week will qualify. The college expects to raise the wages of some employees to account for the new regulations.
“We have identified approximately 15 positions throughout student services, research, admissions, and advancement that are affected by the FLSA changes,” said Pamela Prescod-Caesar.
First passed in 1938, the FLSA introduced “time and a half” overtime pay, as well the forty hour work week and prohibitions of “oppressive child labor.” However, the threshold for who is eligible for overtime pay had not kept pace with inflation. The new provision not only raises this threshold, increasing salaries for an estimated 4.2 million workers, but also will automatically increase it every three years to keep pace with inflation.
As an institution that currently pays workers between $23,660 and $47,476 per year, Swarthmore College is required to adjust its current practices. In response to the new provision, the Human Resources Department has spearheaded the effort to make the appropriate adjustments. Vice President for Human Resources Pamela Prescod-Caesar notes that there are multiple ways for the college to come into accordance with the law.
“In consultation with senior staff and the relevant division supervisors, we will be making the appropriate adjustments to comply with the new [Department of Labor] requirements. We have until December First to make the required adjustments and are currently exploring all options,” she noted.
The college has two options: it can either choose to raise to the salaries of employees earning between $23,660 and $47,476 to the salary for which they would be exempt from overtime— $47,476 —or can maintain salaries and pay qualifying employees overtime when due. This may be decided on a case-by-case basis.
“It’s likely that for some exempt employees, salaries will be adjusted (i.e, increased) in order to meet the new threshold requirement. We are also considering implementing the tracking of hours as an option to ensure that employees are fully compensated for the hours they work,” said Prescod-Caesar.
These “adjustments” regard whether the college will choose to increase workers’ salaries or continue to pay them overtime. Vice President for Finance and Administration Gregory Brown says that this depends on the workers
“The change in the status is about whether their work is actually exempt … If they clearly are doing hourly functions that are classified as such, then we would continue to pay overtime. If you’re a dining services worker serving students, you’re paid by the hour.”
Regardless of the adjustments made, Brown does not foresee the FLSA placing a significant financial burden on the college.
“I am working closely with Human Resources to review the budgetary impact of the proposed changes … [The office is] evaluating how any changes might affect our overall operations and budget. At this time, we do not anticipate financial challenges implementing the changes.” “Relative to the college’s budget, it’s not a lot, and we did set aside money in preparation.”
Both administrators suggested the college had a strong commitment to fair working standards.
“The College has a long history of providing competitive and equitable salaries for staff,” added Brown.
Note that despite having the second-highest endowment per students among peer institutions, the college still does not provide childcare to staff members. Furthermore, it was only this July that the college introduced a shift differential for night staff, offering slightly higher wages for staff working evening shifts, far later than peer institutions like Bryn Mawr College, University of Pennsylvania, and Williams College.
Though it took a national provision from the Department of Labor for the college to increase salaries for its workers, the result is nevertheless in place. For around 15 employees, come December, they will be better compensated for their labor.
