IS Classification Project FAQ: FLSA Questions

The following are answers to frequently asked questions about this project.

NEW If I received pay for the final two weeks of December, 2022, via a separate check after January 1, 2023, will those earnings show up in this tax year (2022) or next (2023)?

All earnings are counted toward the year in which they were paid, even if they are meant to address a previous year’s wages. In this case, pay for the last 2 weeks of December will count toward your 2023 taxes.

NEW How do I account for On-Call hours? Can you give me some examples?

Example 1: Employee’s regular shift is 8am-5pm and they started a 24-hour on-call rotation at 8am. Assuming they were not called in to work, they would log 8 hours REG and 16 hours of on-call.

Example 2: Employee began their on-call shift during a non-regular workday. Assuming they were not called into work, they would log on-call hours for the duration of time they were on-call. For instance, if their on-call shift was 12am Saturday to 12am Monday, they would log 48 hours of on-call.

Example 3: Employee’s regular on-call shift coincides with a UO holiday. Assuming they were not called in to work, they would log 8 hours of REG (for the holiday) and 24 hours of on-call (or however many hours their on-call shift lasted).

What is FLSA?

FLSA is an abbreviation for the Fair Labor Standards Act, a federal law which establishes minimum wage, overtime pay eligibility, recordkeeping, and child labor standards affecting full time and part time workers in both private sector and in federal, state, and local government.  It’s managed by the US Department of Labor’s Wage and Hour Division.  

What does my FLSA status mean?

For most employees, the most pertinent aspect of FLSA is exemption status – whether or not their position is exempt from overtime rules at the federal level. If a position is non-exempt, then the worker in that role is entitled to minimum wage of not less than $7.25 per hour (Federal Minimum Wage) and overtime pay at not less than one and one-half times their regular rate of pay.  State minimum wages that are higher replace the federal minimum wage in many cases. If a position is exempt, it is not eligible for overtime, but also must meet the salary threshold for exemption (see more below).

Who decides if a position is exempt or non-exempt?

When positions are reviewed by University Human Resources, determining FLSA exemption status is a part of that review. That determination is made based on what are called the FLSA tests – one for salary, and one for duties. For the salary test, the position must earn at least $684 per week or $35,568 annually. For the duties test, there are categories of exemptions, with the most applicable for IT personnel being the Computer Employee Exemption.  If the primary duties of the job fit within the exemption criteria outlined by the Department of Labor, and the position meets the salary test, it will be deemed FLSA exempt.

Why was my FLSA status reviewed and why is it changing now?

During the IS Position review project, where several Officers of Administration were moved to Classified SEIU (Service Employees International Union) positions, the inconsistencies in FLSA status were highlighted and noticed by both IS and HR. As newly SEIU positions needed to have FLSA status confirmed, and there were clear inconsistencies, the University was on notice for the issue and corrected the discrepancies across the unit.

Why did some positions change FLSA status and others did not?

Some positions had the appropriate FLSA status and some did not, so not all positions needed adjustment. Moving forward, IS can expect that all ITC (Information Technology Consultant) positions will be non-exempt as well as competency level 1 positions in the OSNA (Operating Systems/Network Analyst) and AP (Analyst Programmer) classifications.  OSNAs and APs at competency level 2 or 3 are exempt. This practice is in alignment with both Oregon State University and Portland State University, peers who share the SEIU CBA with the University of Oregon. 

How many employees had a change to their FLSA status?

30 employees were notified that their FLSA status was being corrected.  Not all of these individuals had a change to their time reporting period as a result of the FLSA change, however.

How will the transition in FLSA status affect future paychecks?

Employees who are moving from non-exempt to exempt status will be paid for their regular hours on their monthly paycheck. Hours worked in excess of 40/week will be accrued as Exchange Time (explanation below).  Some employees who are transferring from mid-month paid employees will see an additional payment on January’s disbursal for the last two weeks of December. Going forward, they will receive full paychecks on their regular paydate.

Will exempt employees be paid a set amount each month?

Exempt employees are paid on a salary basis.  The UO considers a standard month to be 173.33 hours for salaried individuals.  Employees who were previously hourly and saw variance depending on the working hours per month will see a consistent base pay; any additional pay (on-call, for example) will be on top of the set salary. 

How does Exchange Time work?

Exchange time is calculated as a separate leave bank. It is earned when an employee is called into work after reaching 40 regular hours worked in a weekly pay period (Monday – Sunday). Exchange time is earned as a 1:1 ratio per hour worked. Exchange time must be used within the same fiscal year it is earned (by July 1), unless the employee and supervisor agree to allow carry over into the following fiscal year. This should only occur if the employee earns Exchange time close to the July 1 cutoff date and there is no logistical way for them to spend down their balance.

The CBA says UO can choose to pay for on-call hours or provide exchange time for FLSA-exempt employees. How is IS handling on-call hours for FLSA-exempt employees? 

IS is paying employees for on-call hours, but any hours worked in excess of 40 hours will be handled through exchange time at a 1-1 rate.

How will on-call be calculated?

On-Call is explained in the SEIU CBA Article 50, Section 13(B). It is earned when employees are on-call as part of their regular duties and earned as a 1:6 ratio. Specifically, for every 6 hours an employee is on-call, they earn 1 hours of on-call differential. For example, if an employee was on-call for a 24-hour period but was not called into work, they would receive an additional 4 hours of on-call pay. On-call is paid (cash) as a differential on paychecks.