From time to time, government rules and regulations come along that can directly impact church staff and employees.
In coming months, there is a new United States Department of Labor rule that may impact whether some church employees are required to be paid overtime.
It is important to note that this new rule does not change the law that ministers are exempt from the overtime rules under the Fair Labor Standards Act. The ministerial exception to the overtime rules includes individuals in ministerial roles, even when the individual is not ordained or licensed.
Under the Fair Labor Standards Act, certain classifications of employees must meet certain qualifications to be exempt from overtime pay when working more than 40 hours in the workweek. Although there are several qualifications, two of those qualifications are that the employee must be (1) paid on a salary basis and (2) that salary must exceed a minimum threshold. The Department of Labor has announced a two-phase increase in the minimum salary threshold.
The first of the two-part change goes into effect July 1, 2024. On that date, the minimum salary threshold in- creases from an annual salary of $35,568 to $43,888. The second increase occurs just six months later on January 1, 2025, when the minimum salary threshold will in- crease to $58,656.
There were more rule changes that were announced by the Department of Labor, although the other changes will impact very few churches. You can find more about these changes by speaking with a qualified professional or you can also find more helpful information on this topic for churches online by clicking here.
It is important for churches to be good stewards of all that God has entrusted us with, and we wanted to share this important information with you.
If you have further questions, WatersEdge also can be a source of assistance in this area online at www.watersedge.com/tax-financial-and-legal-guidance. You can email questions to WatersEdge at taxhelp@WatersEdge.com.
