Proposition 206-Minimum Wage Increase and More

Ballot measure Proposition 206 was passed by Arizona voters in November. In addition to annual minimum wage increases, employers will be required to provide earned paid sick time to their employees.

Minimum Wage Increase

  • $10.00 on and after January 1, 2017
  • $10.50 on and after January 1, 2018
  • $11.00 on and after January 1, 2019
  • $12.00 on and after January 1, 2020
  • Will be increased by the cost of living adjustment on and after January 1, 2021

Earned Paid Sick Time

Starting July 1, 2017 all employers are required to allow an employee to accrue a minimum of one (1) hour of sick time per thirty (30) hours worked, subject to the following limits:

  • Employers with fewer than 15 employees are required to allow an employee to accrue a minimum of and use up to twenty-four (24) hours of earned paid sick time per year.
  • Employers with 15 or more employees are required to allow an employee to accrue a minimum of and use up to forty (40) hours of earned paid sick time per year.
  • An employer is allowed to select higher limits.
  • Unused earned paid sick time shall be carried over to the following year, subject to the limits
    stipulated above.

All full-time, part-time and/or temporary basis employees are included.

Employees may utilize the accrued earned paid sick time without an employer retaliating for the following conditions and/or events:

  • Mental or physical illness, injury or health conditions;
  • Care of a family member with the above needs;
  • Communicable diseases announced by Public Officials; and
  • Domestic violence and related follow up.

An employer shall have a written policy for unforeseeable earned paid sick time requests. An employee shall make a good faith effort if the earned paid sick time request is foreseeable.

An employer may be subject to additional payments for failure to implement and adhere the new regulation. There may be additional payments to the employee if an employer retaliates.

Holdsworth Chadd Fuller CPAs can help you with all your accounting and payroll needs. Contact us today for a free consultation >>>

New Overtime Exemption Rules-UPDATED

UPDATE: Following a court hearing held November 23rd, the United States District Court issued a nationwide injunction prohibiting the enforcement of these rules. Therefore there will be no change taking place December 1.

ORIGINAL ARTICLE: Last week the White House and Department of Labor released the details of the new overtime exemption rules, which are to take effect December 1, 2016.

The aspect of the new rules that will affect white collar workers is the increase in the minimum salary for employees exempt from overtime. Currently, the minimum salary for exempt employees is $23,660. The new rules more than double this amount to $47,476. In order to be an exempt employee, three requirements must be met: they must perform exempt duties, be paid the minimum salary, and be paid on salary (not hourly) basis.

What does this mean for employers?

Employers will need to review their payroll to see if they have any employees currently on a salary less than $47,476 per year that may work overtime hours during any one week. If you do, then you have a few options to stay in compliance with the labor rules. You can choose to raise their salary to the new minimum, to switch these employees to an hourly rate, or to keep them on their current salary and pay the overtime rate in addition to their salary in the event that they work overtime. A salary below the minimum amount is legal, however, the employee must be compensated for overtime.

A change was also made to the minimum salary for highly compensated employees, increasing that amount from $100,000 to $134,004. The minimum salary for both exempt and high compensated exempt employees is set to be adjusted every three years beginning January 1, 2020.

For more details on the new rules, visit the website below:

http://www.wagehourinsights.com/new-exemption-rules/

Holdsworth Chadd Fuller CPAs can help you with all your accounting and payroll needs. Contact us today for a free consultation >>>