By SUSAN JONES

On Jan. 25, around 800 Pitt employees received email notices that their Fair Labor Standards Act designation was changing from exempt from overtime to non-exempt, or vice versa.

The changes were prompted by a review the Office of Human Resources conducted as part of the compensation modernization program. About 70 percent of those affected will be switched from salaried to hourly employees, while the rest moved in the other direction, said Maureen Pastin, director of compensation.

After the new job catalog was put in place in August, HR proactively decided to review the FLSA status of certain employees under the new job structure, “to make sure they are in compliance with federal law,” Pastin said.

An FLSA calibration committee was set up that included people from HR’s information systems, compensation, consulting services and strategic projects departments, along with the Office of University Counsel, the payroll department and University communications.

The federal Fair Labor Standards Act (FLSA) establishes minimum wage, overtime pay and recordkeeping for all private and government sector employees. Those who do not qualify for overtime (labeled exempt employees) must:

• Be paid on a salaried basis, not an hourly basis

• Meet criteria for executive, professional, administrative, computer or outside sales activities

• Must be compensated at least $35,568 annually (or pro-rated if part-time).

The new designations will not impact employees’ salaries, although their pay period will change. Hourly employees are paid bi-weekly, while salaried staff are paid monthly.

“While we understand that this change may be concerning for impacted employees, we really want to emphasize that nothing about their job duties or performance or their value to the University is changing due to their change in exemption status,” Pastin said.

For those moving from salaried to hourly, there also will be a “look-back period,” where they can claim overtime from the previous two years, particularly on large group projects they’ve worked on or if they had to fill in for someone on leave. While Pitt’s standard work week is 37.5 hours, time and a half overtime pay doesn’t kick in until after 40 hours. Employees are paid at the regular rate for the hours between 37.5 and 40.

To help with this process, HR has trained “time validators” in each of the affected departments who will work with impacted employees. The time validation worksheets are due back to HR by Feb. 16.

Those moving to bi-weekly pay will get their normal monthly paycheck at the end of February, and will start submitting weekly timecards on March 4. They will receive their first bi-weekly paycheck on March 8. The money owed from previously worked overtime will be included in the April 5 paycheck.

Those moving to salaried will have their status switched on March 3, but will still submit their final weekly timecard on March 4. They will receive their last biweekly paycheck on March 8 — for the period of Feb. 18 to March 3 — and receive their first monthly paycheck on March 29.

Mark Burdsall, assistant vice chancellor of human resources, said the FLSA project is strictly about “following the laws,” and for the compensation team, it’s “pretty straightforward.”

But for those impacted, it may not be quite so straightforward. Some have expressed that moving from salaried to hourly feels like a demotion, even though their salary hasn’t changed and they could potentially earn more with overtime.

“We know that this is very personal to employees,” Pastin said. “And we’re trying to deal with this change with as much transparency and compassion and empathy as we can. … It’s not accurate that a non-exempt job has any more or less meaning than an exempt job; it’s simply how they’re being paid. That’s a hard message for people to embrace. We understand that and we don’t want to ever, through this project, diminish the importance or the value or impact that employee has in their role.”

A Sharepoint site offers more information for those affected (Pitt password needed): https://pi.tt/flsa-resources. Burdsall encouraged those affected to go to this site, even if they think they understand the payroll changes. It also has information about when benefits are deducted.

Susan Jones is editor of the University Times. Reach her at suejones@pitt.edu or 724-244-4042.

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