On December 1, the FLSA Minimum Salary level test for Executive, Administrative and Professionals changes to $47,476 or $913 per week. There has been much wrangling, much discussion and many changes made in the last few weeks by employers in anticipation of this change.
Currently, the FLSA requires that to be exempt, employees must earn at least $455 per week, an amount that has been in place since 2004. The DOL has proposed increasing this to $921 initially and adjusting the amount annually using a fixed percentile of wages from data provided by the Bureau of Labor Statistics (BLS) or based on the Consumer Price Index (CPI). It is estimated that the minimum salary for 2016 would be $970 per week, or $50,440 per year for year-round workers.
The good news is that classroom teachers and academic administrative employees* (e.g., counselors, assistant principals, principals, curriculum specialists, and instructional coaches) are exempted from the salary level test (29 C.F.R. §541.303), so the change in regulations will have no impact on them. For other employees, including part-time professionals, the proposed salary level may result in their positions being reclassified as nonexempt because they no longer meet the salary level test. If this occurs, the affected employees would be required to track their hours and be subject to record keeping and overtime pay rules.
Perhaps the most challenging and complicated issues discussed have centered around the FLSA status of school coaches. Before we go much further let me direct you to some important documents from the U.S. Department of Labor:
- Title 29- Subtitle B – chapter V – Subchapter A - Part 553 – application of the Fair Labor Standards Act to Employees of State and Local Governments
- This can easily be found by going to www.ecfr.gov browse for Title 29 and Part 553
- July 14, 2004 USDOL- Wage and Hour Division FLSA2004-6, Opinion Letter Volunteers in Schools
- or go to US.dol.gov search FLSA2004-6, scroll down the list until you find 2004-6 Volunteers in schools.
- DOL definition of Teacher and reference to coaches
- Primary Duty
On November 14, Poms and Associates in conjunction with the law firm of Jackson/Lewis conducted a webinar to ease some confusion and answer some specific question. Here are a few of the answers that we have come up with:
Teachers As Coaches and Coaches as FLSA Exempt
Let’s start with some language from the Department of Labor:
- First, the existing FLSA regulations, and this part has not changed under the new rule, specifically provide that “faculty members who are engaged as teachers but also spend a considerable amount of their time in extracurricular activities such as coaching athletic teams or acting as moderators or advisors in such areas as drama … are engaged in teaching. Such activities are a recognized part of the schools responsibility in contributing to the educational development of the student.”
- DOL/Wage and Hour Division/ Overtime Final Rule/ Frequently Asked Questions
“3. Q. Is there an exemption for schools and institutions of higher education from either the FLSA or the Department's overtime regulations governing white collar workers?”
“Schools and institutions of higher education are generally covered by the FLSA's minimum wage and overtime provisions. …Teachers are exempt if their primary duty is teaching, tutoring, instructing or lecturing. "Teachers" include, for example, regular academic teachers, kindergarten or nursery school teachers, teachers of gifted or disabled children, professors, adjunct instructors, teachers of skilled and semi-skilled trades and occupations, home economics teachers, vocal or instrument music teachers, and under certain circumstances, athletic coaches and assistant coaches. Although a preschool may engage in some educational activities, preschool employees whose primary duty is to care for the physical needs of the facility's children would not meet the requirements for the exemption as a bona fide teacher.”
The “under certain circumstances” refers to the definition of a teacher, for a coach to qualify as exempt under the teacher definition their primary duty must be teaching, tutoring, instructing or lecturing in the activity of imparting knowledge. Perhaps the best definition is one given in the guidance to Higher Education published the same time as the new rule. It specifically states:
“Coaches: Athletic coaches and assistant coaches may fall under the exemption if their primary duty is teaching, which may include instructing athletes in how to perform their sport. If, however, their duties primarily include recruiting athletes or doing manual labor, they are not considered teachers. A coach could primarily be responsible for instructing athletes but also spend some time recruiting or doing manual labor and still be considered ineligible for overtime.”
The key to this and all discussions regarding the classification of employees per legal counsel is -you must be able to articulate the primary duties. As an HR professional, who has dealt with the DOL, I am going to amend this sentence to “clearly articulate and demonstrate the duties”. In addition, I would strongly recommend adding language to both a coaching contract or the coach job description that requires instructing athletes in physical health, teamwork, sportsmanship and safety in addition how to perform in their sport.
Volunteer Coaches in Public Schools
Employees May Volunteer To Coach
“Section 3(e) (4) (A) of the FLSA and 29 CFR 553.101 and 553.103 indicate that individuals are volunteers, not employees of a public agency, when they meet the following criteria:
- Perform hours of service for civic, charitable or humanitarian reasons without promise, expectation, or receipt of compensation for the services rendered. The statute clarifies that a volunteer performing such service can either receive no compensation or be paid expenses, reasonable benefits or a nominal fee to perform such services;
- Offer their services freely and without coercion, direct or implied, from the employer;
- Are not otherwise employed by the same public agency to perform the same services as those for which they propose to volunteer.
- In other words, individuals can qualify as volunteers if they either volunteer for different agencies or perform different services than they are employed to perform.”
The primary key is the final bullet- an employee cannot volunteer to do the same job they perform for the school i.e. a bus driver cannot volunteer to drive a bus, an accountant cannot volunteer to collect money, a cafeteria worker cannot volunteer to cook and run a concession stand.
The only exception is for parents and guardians of students participating in an activity in which the employee is volunteering.
“The WHD does not assert FLSA violations for time spent by a public school employee who is also the parent (or who stands in loco parentis) of a child in that school, when the parent volunteers in activities directly involving the child’s education and participation. The WHD will thus not enforce the provisions of the FLSA for the time spent driving the basketball team by a volunteer bus driver who is a parent of a student participating on the basketball team.
This WHD enforcement position applies only if the activities are done without expectation of compensation and there is no coercion or pressure on the employee by the employer to provide the volunteer services. Also, it does not waive or otherwise have any effect on an individual employee’s right under Section 16(b) of the FLSA to maintain a future claim for appropriate FLSA compensation for “volunteer” hours.”
The last important element in the approach of employees volunteering to be coaches is that a volunteer cannot receive compensation for services rendered and cannot be coerced or pressured (overtly or indirectly) into volunteering. Again, you need to have a clear line in the sand.
I recommend that you have a written agreement with the employee that states they are clearly and freely volunteering without coercion and they understand they will not receive compensation other than reasonable or nominal fees to cover expenses.
Stipends and Increments for Volunteer Coaches
The U.S. Department of Labor has stated:
“Section 3(e)(4)(a)(i) [enclosure #1] and the implementing regulations at 29 CFR §553.106 provide that a volunteer may only be paid expenses, reasonable benefits, or a nominal fee, or any combination thereof, without losing volunteer status.”
The stipend or increment for an employee’s volunteer dutiess cannot exceed twenty percent of what a full-time employee would be paid to perform the same service. Remember you must have a clear and written volunteer agreement as described above, otherwise the coaching is considered “additional job duties”.
A Non-Exempt Employee Who is Also An Employee Coach
There are three critical points to remember if you have a non-exempt employee who is also employed as a coach:
- A non-exempt employee cannot be paid a stipend or increment unless they are a volunteer!
- A non-volunteer coach will need to be paid at an hourly rate for each job (the non-coaching and coaching).
- The rates will need to be blended based on the actual hours in each position and overtime paid for hours over 40.
Poms & Associates Risk Services can assist your organization in many areas related to human resources, employee benefits, employment, health & safety, organizational development, and more. Your HR Team is also available to provide answers to day-to-day questions with regard to compliance with various regulations. In addition, we can assist organizations with training, document preparation and compliance assessments on a per project basis. For more information, please contact us at (505) 797-1354 or email us.
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