State's Overtime Wage Law Favors Employees
Virginia Governor Ralph Northam's recent signing of the Virginia Overtime Wage Act is good for workers, but could create issues for employers, reports JD Surpa.
When the new law goes into effect on July 1, 2021, it will change the way employers in the state calculate "regular rate of pay" for salaried workers.
Under the new law, the pay of a salaried employee will be calculated as one-fortieth of all wages paid for a workweek, even if that employee commonly works more than 40 hours.
JD Surpra says the change creates a potential liability for employers who incorrectly identify employees as exempt. That's because a higher regular rate of pay would be used to determine damages.
Previous Virginia law stated that "an employee's regular rate of pay constitutes their hourly rate and any additional compensation received in a workweek." The new law doesn't change the way hourly employees are paid.
For more on the new law and how it impacts employers in Virginia, read the rest of the report here.
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