Reimbursing employees’ health insurance premiums and other health costs on a pre-tax basis again is available, thanks to the 21st Century Cures Act signed recently by President Obama. The law becomes effective January 1, 2017. A few words of caution - the law applies only to “small” employers, and it contains other significant limitations that could render it inappropriate in many circumstances.
By Sally Wagenmaker and Michael E. Batts, CPA
Temporary Injunction Puts Implementation in Question
A federal judge yesterday issued a nationwide temporary injunction halting the implementation of a new overtime pay rule scheduled to go into effect on December 1, 2016. The judge, Amos L. Mazzant III – appointed by President Obama – ruled that the Obama administration (specifically, the U.S. Department of Labor) exceeded its legal authority in implementing the new rule. Consequently, this rule change is on hold for all U.S. employers.
With the new federal overtime regulations becoming effective December 1, 2016, employers across the country are addressing how to calculate a salaried, non-exempt employee’s overtime wages. This question has become more acute now that many currently exempt employees will be classified as non-exempt, if they do not meet the increased salary threshold of $47,476 for the white-collar exemption, and therefore are owed overtime pay. The specific calculation approach may significantly impact the resulting overtime pay owed, and the results may be surprising. The following examples and recommendations provide insights for optimal overtime pay practices.