HR ALERT – FLSA CHANGES BLOCKED BY FEDERAL COURT ON NOVEMBER 15, 2024

In our June newsletter we informed you of a major change to the Federal Fair Labor Standards Act (FLSA).   Under this Federal rule change exempt employee salary thresholds were increased in July 2024.  Additional increases were set to go into effect on January 1, 2025.  A federal court judge in Texas has ruled that the Department of Labor (DOL) overreached in making these changes and has reverted the FLSA salary thresholds back to the 2019 levels.  ($35,568 annually/$684 weekly) The court’s order applies nationally.  The DOL may appeal this decision.  However, given the new administration, it is unlikely the new thresholds will go into effect for the foreseeable future. 

How does this affect you and your organization?

Nonprofit employees are subject to the FLSA.  (Independent Contractors, Volunteers and qualifying Interns/Trainees are not.)  Usually, hourly employees are subject to the FLSA meaning they are eligible for overtime pay for any work performed over 40 hours in one week.  They are called “non-exempt” employees.  Non-exempt employees have been unaffected by these rule changes.

Often, salaried employees working in a professional or administrative capacity are not subject to the FLSA.  They are considered “exempt” employees and are not eligible for overtime pay for hours worked over 40 in one week. Salaried employees must make a minimum weekly wage in order to meet the salary test to qualify as an exempt employee.  The salary threshold was the subject of the DOL rule change and the Federal court’s order.   

For now, the FLSA exempt employee thresholds will revert to their pre-July 1, 2024, levels.  This means that employees who are paid a least $684 a week ($35,568 annually) meet the salary test for exempt employee status.  If the employee earns less than $684/week the employee is eligible for overtime pay for any work performed over 40 hours in one week.

Please be aware that the salary threshold is the first prong in a three-prong test to qualify as an exempt employee under the FLSA.  Employees must satisfy all three prongs to qualify as exempt.  Finally, employers should be aware that some states and local municipalities may have their own minimum salary thresholds for exempt status to apply. 

We understand that these changes may be confusing.  If you have questions about the FLSA and how these changes may affect your organization, please contact the Law Offices of Elizabeth Reinhardt and Associates.  We are happy to answer any questions you may have concerning employer overtime requirements or any other employment law issue.

Congratulations to Liz Reinhardt!

Liz Reinhardt has been selected as one of Massachusetts Lawyers Weekly Top Women of Law for 2024. The 2024Top Women of Law award celebrates the achievements of exceptional women lawyers who are pioneers, educators, trailblazers, and role models. Liz will be honored together with her fellow recipients at an awards event on November 12th! Please join us in congratulating Liz on this much deserved distinction!

MNN Conference 2024!

It’s October and it’s time once again for the Massachusetts Nonprofit Network (MNN) Annual Conference. This year’s conference, Building the Future, will celebrate creative ways nonprofits are making a difference. The event will be held on Thursday, October 24th at the DCU Center in Worcester and will feature empowering speakers, thought-provoking workshops, and plenty of opportunities for networking. If you are planning to attend this inspiring event, please stop by our table. We’d love to see you! Click here to become a member.

Remote Member Meetings Are Permanent!

We are happy to announce that Section 6A of Mass. General Laws Chapter 180 has been permanently amended to allow on-line member meetings and voting at any annual, regular or special meeting when authorized by a nonprofit corporation's Board of Directors. This amendment now permits meetings of corporate members in-person, hybrid and in all remote settings assuming certain safeguards to ensure adequate notice and voting security are followed. Our Firm was pleased to have an opportunity to comment on the proposed legislation through the highly dedicated team at the Boston Bar Association who advocated for this legislation over many months before it was approved by the legislature and signed into law by Governor Maura Healey on March 29th as part of the omnibus budget bill. Please contact us if you have any questions about this long-awaited law.

Changes to IRS e-Postcard Filing for Small, Tax-Exempt Organizations

Smaller charities whose annual gross receipts are normally $50,000 or less may choose to file Form 990-N, Electronic Notice for Tax-Exempt Organizations (e-Postcard). The IRS now offers sign-in options with Login.gov and ID.me. Both offer access to IRS online services through a secure account that protects your privacy. Currently, users with an active IRS username have the option to access the Form 990-N submission page using their active IRS credentials, however, this option will eventually be phased out. If you have an existing IRS username, the IRS recommends creating an account with Login.gov or ID.me as soon as possible. Please click here to view a copy of the IRS Form 990-N Electronic Filing System (e-Postcard) User Guide.

Online Filing Now Availalble for MA AGO Registration and Form PC

Approval time for online registration and Form PC filing has been dramatically reduced to about a week vs. two to three months when these filings are submitted in hardcopy. The Massachusetts Office of Attorney General Non-Profit Organizations/ Public Charities Division encourages Initial Charity Registration and Annual Form PC to be filed online. See details here: https://www.mass.gov/info-details/online-charity-filing-portal.  Please contact Machiko Sano Hewitt if you have any questions about these new online filing systems.

 

MA AGO Publishes an Updated Guide for Board Members of Charitable Organizations

The MA Office of Attorney General Non-Profit Organizations / Public Charities Division (Division) recently published an updated Guide for Board Members of Charitable Organizations (Guide).  The Guide has been a valuable resource for charities and their boards statewide for many years. The updated Guide demonstrates the Division’s renewed focus on certain aspects of fiduciary oversight and operation of Massachusetts charities. Focus areas include duty of allegiance to mission, conflict of interest policy and procedures that are closely aligned with the IRS requirements and emphasis on diversity and term limits as key to keeping vital.  We strongly recommend you share this Guide with your board and management Please contact us with any questions or concerns arising from this revised Guide. 

Office Closed for Vacation August 8 -19

Our office will be closed for vacation AUGUST 8 – 19.  If you need immediate legal assistance, please leave a message via phone or email and one of our attorneys will respond.

Contact Information During Office Vacation Weeks :                             

Phone:  978-464-9003                                   Email:  admin@lizreinhardtlaw.com

Multi-State Registration & Compliance for Nonprofits: When, Where and How

Liz Reinhardt and Chris Leigh-Manuell, Paralegal at Hurwit & Associates will be presenting Multi-State Registration & Compliance for Nonprofits: When, Where and How, a free online event on Tuesday, June 8, 2021 at 11:00 am.

Regulatory requirements for multistate fundraising are complex, hard to navigate, and compliance can be costly. Nonprofits soliciting funds outside their home states are well served when they adopt a strategic approach and have a good grasp of the legal requirements in a changing landscape before wading into these waters.

Register here to find out what your nonprofit needs to know!

 

We look forward to hearing from you!