In case you've been crazy busy putting out fires, it's time to notice that the DOL is expected to release its final overtime rule any day now. The new regulations are bound to create mixed feelings in a subset of your employee group -- those who have long been salaried but are soon going to be responsible for recording their time.
They'll be able to earn overtime, of course, so who wouldn't be celebrating? It's a win/win situation, isn't it? A recent article released by SHRM should bring us all down to earth. The trade off between money and status is complex for many employees. And then there are the semantics.
To many, the word "salaried" seems much more reputable than the more fickle-sounding "hourly" designation. It's not like we don't have other evidence of how people develop perceptions of labels that are deeply meaningful to them. Think about the cultural unease that gets stirred up when something as minor as a sought-after area code or zip code get changed. For some New Yorkers, changing their 212 area code to 646 was a jolt to their identity that they still haven't completely gotten over more than 15 years later. I got to keep my 415 area code in a recent change in the San Francisco area or I might be singing the blues, too.
Please don't kid yourself. Explaining to your employees that the exempt/non-exempt designation is only for payroll purposes (a suggestion in the article) isn't going to smooth any feelings. We're going to have to handle this with a large dollop of sensitivity -- which calls for discussion, preparation and planning. Plus, if we take a close look, you'll be facing important policy implications, too.
As the SHRM article reminds us, you may currently offer salaried employees incentives, more time off or levels of benefits not available to your non-exempt employees. OK, now what? Are you going to grandfather those affected, undermine the logic of these policies and open HR up to criticism? Or are the newly classified just going to be out of luck suddenly, and drop out of all those perks? Better yet but far more costly, are you going to extend some of these opportunities to hourly employees today, to get ready for the upcoming DOL regs? Recording time for business travel, phone calls outside of work hours and emails from home are more details that you'll need to work out -- not to mention eligibility for company-paid or sponsored telephones, credit cards and so on that are often provided to salaried employees.
All valuable reminders. I'm not sure the SHRM article will help you get started on a strong communication strategy, though, so let me give you my best advice.
To do your best work on this, tell the truth to employees. In detail. Don't let them be surprised. How do you do this without shooting yourself in the foot? Start now by making up an affected employee's pro and con list. Are there items that you can improve before implementation? Get started soon. Are there items that employees will misunderstand because of a predictable knee-jerk reaction? Odds are you know that they have some misunderstandings or misgivings now about some of the affected policies, so start clearing things up ASAP.
Once you have the final pro and con list from the employee's perspective, face it head on. Come up with a balanced, respectful way of explaining the changes that your managers will support, and be ready with a list of the best, most candid FAQs you can develop. And don't forget to mention the changes to the other hourly and salaried employees, too. The views and opinions of those affected will influence the rest of your company.
Everything you do in compensation is communication, so why not do everything better? Prepare yourself for explaining the DOL overtime changes by getting yourself a copy of the popular ebook, Everything You Do (in Compensation) Is Communication @ https://gumroad.com/l/everythingiscommunication. Margaret O'Hanlon, CCP collaborated with Ann Bares and Dan Walter to create this DIY guide to compensation leadership. Margaret is founder and Principal of re:Think Consulting. She brings deep expertise in compensation, communications and leadership to topics like the CEO Pay Ratio and performance management discussions at the Café. Before founding re:Think Consulting, Margaret was a Principal at Willis Towers Watson.