Potential federal regulations could strain SIU department budgets
New federal regulations have departments at SIU tightening their already small budgets in preparation to pay their short-handed staffs overtime — if they are implemented at all.
Some 280 university employees are now entitled to time-and-a-half overtime pay under the Fair Labor Standards Act, said Kevin Bame, vice chancellor for administration and finance. Their job requirements are now re-defined by an hourly wage status that reclassifies them as eligible to receive time-and-a-half pay after 40 hours of work.
But the new regulations, which were supposed to take effect Dec. 1, were halted following an injunction filed Nov. 22 by Judge Amos L. Mazzant III of the U.S. District Court for the Eastern District of Texas. There will have to be a federal court hearing to determine if the regulations will be carried out, though no date has been set.
Bame said the overall cost for the overtime is unknown because the university has a decentralized budget, and separate departments must decide how much money to set aside for overtime pay.
The act was originally passed to set up the nation’s minimum wage and establish the 40-hour work week. It also required employers to keep records of the hours their employees worked so overtime could be given to employees who are entitled to overtime pay.
In 2014, President Barack Obama signed a memorandum directing the Department of Labor to re-evaluate the exemptions to ensure that white-collar workers are paid for the overtime they work and to modernize and simplify the regulations. Those regulations had not been updated since 2004.
The Department of Labor amended the act in May by raising the minimum salary threshold for overtime pay from $23,660 to $47,476. This extends overtime coverage to 4.2 million U.S. workers, according to the Bureau of Labor Statistics. The regulations would also be updated every three years to ensure the law stays up to date.
University employees now entitled to overtime under the new regulations earn salary wages paid at a fixed rate on a yearly or monthly basis rather than by the hour. Many of those employees in the past were not paid overtime because they were paid at a set rate, said Mark Brittingham, a clinical assistant professor in SIU’s School of Law.
“What the regulations were supposed to do is cut down on any potential abuse from employers,” Brittingham said.
Bame said many of the employees affected are admission coordinators, or recruiters, which would specifically impact the undergraduate admissions office.
Terri Harfst, undergraduate admissions director, said if the amendment takes effect she would likely try to schedule her dwindling staff so no one is required to work overtime because the department cannot afford to do otherwise.
“Paying overtime would be the last resort,” Harfst said.
She said admissions coordinators usually visit three high schools per day and attend college fairs at night. The irregular hours, she said, leads to a lot of overtime and makes rescheduling workers virtually impossible.
One viable outcome is requiring employees who work overtime to take that time off later as a credit toward paid time off, Harfst said. This compensatory time would be time-and-a-half pay, which Harfst said could ultimately bleed the budgets dry.
Bame said the new regulations could cause complications with departments’ financial plans. Because of the lack of state funding, he added, many of the departments have had to layoff employees, shortening branches of the university that are already short-staffed.
“[Not paying overtime] will be hard for departments to pull off given the university’s understaffed faculty,” Bame said.
Aside from the injunction filed in federal court, the new regulations are faced with opposition from President-elect Donald Trump.
In an Oct. 18 press release, Anthony Scaramucci, one of Trump’s advisors, said the President-elect intends on repealing the regulations.
While the departments have prepared for the implementation of the amendment, all changes at the university have been put on hold because of the nationwide injunction and the probability that Trump will revoke them when he takes office.
“If the changes do take effect, departments should expect to crack down on their budgets,” Bame said.