How will the new DOL overtime rule affect your business?

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White House increases overtime eligibility by millions

The US Department of Labor has approved new regulations governing overtime pay for salaried workers.  Effective December 1, 2016 salaried workers making less than $47,476/year ($913/week) will be entitled to time-and-a-half for work that exceeds 40 hours/week.  This is more than a 100% increase from the current threshold of $23,660/year ($455/week).  The DOL plans on updating the salary threshold every three years.

Currently, any employee whose job duties match the 1 and who make more than $455/week are considered exempt for overtime rules and are not entitled to overtime pay.  While the DOL is not changing any of the job duties requirements to quality for exemption, cleaning business owners will need to comply with the new salary requirement or reclassify workers as hourly by December 1, 2016. 

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Tom Stewart and his wife, Janice Stewart, are co-owners of Castle-Keepers, the 1st company to achieve CIMS certification. Tom is a nationally-recognized leader & innovator in the house cleaning industry. He is co-founder and Publisher of  Cleaning Business Today.

FAQs

Q: What workforce metrics should a cleaning business track?

A: Track applicants, interviews, hires, training completion, time to productivity, attendance, quality, retention, turnover, and labor as a percentage of revenue.

Q: Why is employee turnover especially costly in residential cleaning?

A: Turnover creates recruiting, onboarding, training, supervision, schedule disruption, quality, and customer-retention costs beyond the departing employee's wages.

Q: How can a cleaning company reduce employee turnover?

A: Improve job expectations, manager communication, scheduling, training, recognition, pay clarity, workload balance, and early intervention when attendance or quality declines.

Q: How should contractors and employees be classified?

A: Classification depends on applicable law and the actual working relationship, not merely the label in an agreement. Current legal guidance should be reviewed with qualified counsel.

Q: How often should staffing performance be reviewed?

A: Recruiting pipelines should be reviewed weekly, while turnover, retention, productivity, and labor-cost trends should be reviewed monthly and over rolling periods.

Author

  • Tom Stewart headshot

    Tom Stewart is a CEO and industry thought leader focused on scaling residential cleaning businesses through strategy, systems, and leadership development, translating complex concepts into actionable frameworks. With his wife Janice Stewart, he co-owns Castle Keepers, the first company to achieve CIMS certification. Tom is the founder and CEO of MaidCentral Software, the leading business management platform for professional home cleaning companies in North America, and the founding editor and publisher of Cleaning Business Today. Learn more at TomStewart.com.

    Founder and CEO
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Cleaning Business Today - The magazine for the cleaning industry
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