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  • Columbus, Ohio, recently joined other states and municipalities that have passed laws prohibiting employers from inquiring into a job applicant’s salary history. The following cities in Ohio currently have these ordinances:

    • Toledo 
    • Cincinnati

    The Columbus ordinance covers all business owners within the city with 15 or more employers and their agents, such as job placement or referral agencies. It prohibits employers from asking applicants about their salary history, current or former employer, or searching publicly available records to obtain their salary history. An applicant is considered to be any individual applying for employment that will be performed within the city’s geographic boundaries and whose application will be solicited, received, processed, or considered in whole or in part in Columbus.

    The ordinance states that it’s an unlawful discriminatory practice for an employer to do the following:

    • Inquire about an applicant’s salary history, including prior wage, benefits, or additional compensation
    • Screen applicants based on their current wages, benefits, compensation, or salary history, including that an applicant’s salary history meets minimum or maximum criteria
    • Rely solely on an applicant’s salary history when deciding whether to extend an offer of employment or when determining an applicant’s salary, benefits, or other compensation
    • Refuse to hire or otherwise disfavor, injure, or retaliate against an applicant who doesn’t disclose their salary history

    However, employers can still ask applicants about their salary, compensation, and benefits expectations. In addition, employers may inquire into objective measures of the candidate’s productivity, including revenue, sales, or other production reports.

    Its’ prohibitions do not apply if another federal, state, or local law specifically authorizes reliance on salary history to determine employee compensation for a specific position. In addition, it applies to the following:

    • Internal transfers or promotions with a current employer
    • Voluntary disclosures by the applicant
    • Positions for which salary or compensation are set by collective bargaining
    • Applicants who are re-hired by an employer within three years of leaving the employer

    This ordinance goes into effect on March 1st, 2024. Once it’s effective, all employers who fail to comply with its prohibitions permit an applicant to file an administrative complaint with the Columbus Community Relations Commission. Should you violate the ordinance, you could be subject to civil penalties of $1,000 to $5,000.

    If you’re a GMS client and have questions, please contact your HR Account Manager. However, if you aren’t a client of GMS, contact us today to stay compliant with ever-changing laws and regulations.

  • California Governor Gavin Newsom signed a bill into law on September 27th, 2022, stating that all businesses with 15 or more employees must include pay ranges in all their job postings. This bill will take effect on January 1st, 2023. Other states have implemented similar laws including Washington, Colorado, and Connecticut.

    A Deeper Understanding Of California’s New Bill

    In addition to providing applicants with the pay range on the job posting, employers with 100 or more employees must submit a pay data report to the state’s Department of Fair Employment and Housing. The report must include the number of employees in the following job categories based on race, ethnicity, and gender:

    • Executive or senior-level officials and managers
    • First of mid-level officials and managers
    • Professionals 
    • Technicians 
    • Sales workers
    • Administrative support workers
    • Craft workers
    • Operatives
    • Laborers and helpers
    • Service workers

    Failure to provide a report each year could result in a fine of $100 per employee. The purpose of record-keeping is to prevent discrimination. 

    The Benefits Of Including Salary Range On Job Postings

    HR professionals often question whether they should include the salary range on a job posting. A vast majority of employers advocate for leaving the salary range off a job application. However, salary information is important to the applicant. So, sharing salary ranges can help attract workers. A survey conducted by LinkedIn showed that 70% of professionals want to hear about salary in the first conversation with the recruiter. So, cut out the middleman, and include it in the job posting. It ultimately saves you time while simultaneously giving vital information to potential candidates.

    Did you know that only 12% of postings from U.S. online job sites include salary ranges? While more and more businesses are beginning to add job pay on their postings, the number of businesses that don’t provide the pay range is still significantly higher than those that already do it. Stand out from your competition. Being upfront and honest about your positions, which means including the compensation, ultimately gives you a competitive advantage in a saturated market.

    Outsource Human Resources Today!

    With ever-changing rules and regulations, it’s vital to ensure you stay compliant. When you partner with GMS, we keep you up to date to ensure compliance. In addition, our HR experts work with you to write eye-catching job descriptions that set you apart from your competition. We conduct market analyses to provide the best pay range for your open positions. Focus on what you do best and allow GMS to handle the rest. Partner with us today!

  • Since U.S. businesses are still having a difficult time filling open positions with quality talent, employers anticipate pay to go up in 2023. According to the Bureau of Labor Statistics (BLS), there were more than 11 million job openings at the end of May 2022. In addition, approximately four million workers quit each month. The question employers keep asking themselves is, why are so many employees leaving their jobs?

    Americans are quitting their jobs for multiple reasons, including: 

    • Seeking higher pay
    • Remote work is appealing to individuals 
    • Rejecting return to office policies 
    • Burnt out

    The Response From Employers 

    With a labor market that has more open jobs than individuals to fill them, businesses have been forced to stay current with what’s happening in the employee marketplace and how that affects pay. 96% of companies have begun increasing salary budgets. A study by WTW showed that the average salary increase hit 4.9% in 2022 compared to a four percent increase back in 2021. However, it is more important than ever for businesses to have a strategic plan while increasing salaries.

    Additional insights from the WTW survey show: 

    • 46% of employers cited employees have higher expectations for wage increases because of inflation
    • Two in three employers are budgeting for higher pay raises this year
    • 90% of employers are having trouble attracting talent
    • 75% of employers said the tight labor market is the main reason for increasing their salary budgets

    Will These Efforts Be Enough? 

    The question remains whether pay increases will be enough for workers as they continue to battle rising prices. Despite a 4.1% salary budget increase, businesses will still fall behind inflation with these pay raises. In turn, workers’ take-home pay is weakened, reducing their buying power. Even though workers continue to hold the upper hand in the job market, many still fear a recession is imminent, and they question the economy’s state.

    GMS Can Take Pressure Off Your Shoulders

    Although there is no way to predict the future and your employees’ response, GMS can certainly relieve you of some of the pressure you may be feeling. Our team of experts works diligently with your team to attract and retain quality employees. Our HR experts can help business owners conduct a salary analysis to determine the correct salary to offer employees based on the market conditions. No need to worry during these unprecedented times; allow GMS to take on the administrative burdens of running your business. Contact us today.

  • The Department of Labor announced a proposal in early March to change the salary-level threshold for white-collar exemptions. This move comes more than two years after a federal judge blocked another attempt to update the threshold for overtime eligibility, although the details of the proposal differ from the 2016 proposal.

    The current salary-level threshold for white-collar exemptions is $23,600 annually, which equates to $455 per week. The DoL’s new proposal seeks to increase the threshold to $35,308 annually ($679 per week) – nearly halfway to the DoL’s 2016 target threshold of $47,476 ($913 per week).

    While the new proposal is notably lower than the blocked attempt, it still marks a nearly 50 percent increase from the current wage threshold. As a result, the DoL “estimates that 1.1 million currently exempt employees who earn at least $455 per week but less than the proposed standard salary level of $679 per week would, without some intervening action by their employers, become eligible for overtime.” That’s a notable change that can have a direct impact on your employee’s compensation.

    Businessman contemplating options regarding the new salary-level threshold proposal from the Department of Labor. 

    Breaking Down the New Overtime Salary-Level Threshold

    The quick explanation of the new proposal is that employees who make less than $35,308 annually or $679 per week may be eligible for overtime pay. Overtime applies to any hours worked past 40 in a given week and will be compensated at a rate of one-and-a-half times an employee’s standard rate of pay. 

    Not all employees would be eligible for overtime pay, however. The job duties of an employee play a major part in deciding whether someone is eligible. As with the current salary-level threshold, employees must pass three tests to qualify for a white-collar exemption from overtime pay:

    • The salary basis test – Exempt employees must be paid a predetermined and fixed salary that is not subject to reduction because of variations in the quality or quantity of work performed
    • The salary level test – Exempt employees must be paid at least a specified weekly salary of $679 per week
    • The duties test – Exempt employees must primarily perform executive, administrative, or professional duties as defined by DoL regulations (duty definitions can be found on the DoL website)

    The new proposal also increases the salary level for “highly compensated employees” (HCE) from $100,000 to $147,414 per year. This group faces what the Society for Human Resources Management (SHRM) calls a “relaxed” duties test. As such, these employees are exempt from overtime if their primary duty is office or nonmanual work and routinely “perform at least one of the bona fide exempt duties of an executive, administrative, or professional employees.”

    It’s important to note that the term “white-collar exemptions” is used, as the new proposal maintains overtime protections for “blue collar” workers who perform tasks that involve “repetitive operations with their hands, physical skill and energy.” This includes no changes in overtime eligibility for any of the following professions:

    • Police officers
    • Fire fighters
    • Paramedics
    • Nurses
    • Laborers
    • Non-management employees in maintenance, construction, and similar occupations (carpenters, electricians, mechanics, etc.)

    Another difference with the new proposal is that there are no plans to make automatic threshold updates in the future. This is a notable departure from the 2016 proposal, in which the threshold would change every three years to match the 40th percentile of earnings of full-time salaried workers in the lowest-wage Census Region. This means that if the proposal were to go into effect, it would only lead to the $35,308 ($679 per week) threshold and not any pre-planned adjustments.

    What Can Small Business Owners Do About the New Overtime Proposal?

    It’s currently a waiting game to see whether this new DoL proposal will go into effect or not. Like the 2016 proposal, the new salary-level threshold could run into some roadblocks. Despite this, it’s best to plan ahead just in case the proposal becomes reality. 

    Your options are largely the same as they were back in 2016, some of which may be more feasible than others for your company. The first is to pay newly-eligible employees overtime pay for applicable hours. Another is to limit employee hours to 40 per week to stop any chance of overtime pay. Each route has drawbacks, as paying overtime will increase your payroll and limiting hours may lead to decreased productivity thanks to change in overall work hours. 

    If neither of those ideas sound appealing, there are some other alternatives. One possible way to mitigate the impact of overtime pay is to raise the wage of workers who are close to the salary-level threshold. For example, if an employee regularly worked extra hours makes $34,000 per year, you could increase his pay to $36,000 per year. You’ll need to do the math to see if the change in pay outweighs the potential costs of overtime, but this method can help you control costs while still offering some reward to an employee.

    A more cost-effective, but less popular, alternative is to lower the salaries of newly-eligible overtime employees. This will help you account for overtime costs, but employees won’t approve of decreased pay if they’re eligible for overtime.

    Protect Your Business Through Preparation

    It’s important to take any proposed regulations seriously, especially when you can face a civil monetary penalty of $2,014 for repeated or willful violations of overtime rules occurring after Jan. 24, 2019. There are still plenty of steps the DoL’s new proposal needs to take, but it’s always good to have a plan in place just in case.

    Unfortunately, there’s not always the time or means to stay ahead of new regulations or other changes that could impact your business. That’s why small business owners turn to GMS to help them stay compliant with current laws and prepare for future legislation and regulations. Our team of experts and integrated HR system allows us to take on the administrative burden of small business payroll management and other crucial human resources tasks.

    Ready to prepare for your business’ future. Contact us today to talk to one of our experts about how we can help.