Editor’s Note: An earlier version of this story misstated that faculty, coaches and others whose primary job involves teaching had a salary threshold of $35,825, which means they would be eligible for overtime if making under that amount. Those positions are exempt from such thresholds. Instead, the $35,825 figure only applies to academic administrative positions, a job that provides career counseling for students. This story has been changed to reflect the correct information.
Hundreds of University of New Mexico employees will soon become eligible for overtime while others will receive a raise to comply with a new U.S. Department of Labor mandate for salaried workers – at a time when UNM is desperately seeking ways to cut costs in the midst of a budget crisis.
Meeting the new regulations is expected to cause some financial pain, and that has both the administration and employees worried.
Dorothy Anderson, head of UNM’s human resources department, said meeting the new requirements for the estimated 860 eligible employees would be “a budgetary challenge.”
And Danelle Callan, president of the UNM Staff Council, said she and other employees fear the administration is rushing, which she argued could lead to a loss of wages.
“We remain concerned that these changes are being implemented so quickly we may not leave adequate time to properly train administrators in all the complex requirements of this new regulation,” Callan said in a statement to the Journal.
Earlier this year, the U.S. Department of Labor, at the direction of President Barack Obama, raised the threshold for an employee to be salaried, and therefore ineligible for overtime pay, from $23,660 annually to $47,476 annually effective Dec. 1.
Private-sector employers and nonprofit groups raised myriad concerns over more than doubling the threshold amount. They said it would affect many entry- and mid-level managers and professionals, and in some cases lead to job cuts.
Faculty, coaches and others whose main job is teaching are exempt. The threshold for academic administrative positions, a job that provides career counseling for students, is set at $35,825.
Under changes set to take effect Nov. 12 at UNM, roughly 860 employees – the majority of whom make between $23,660 and $47,476 – will become nonexempt and thus eligible for overtime pay. Another 50 will receive a pay increase to bring them to the new minimum for salaried workers.
If each of the newly qualified employees worked just one hour’s worth of overtime a week, it would cost the university nearly $1.5 million. And that’s challenging news for the university, whose budget only has grown tighter recently due to cuts in state funding totaling nearly $15 million.
Employees making the transition also will see a change in pay schedules. Exempt employees, those not qualified for overtime, are paid in monthly cycles. Nonexempt employees, those qualified for overtime, are paid every other week.
When nonexempt employees move to the new pay schedule, their first pay cycle will be just nine work days. In the next pay cycle they will receive their normal 10 days’ worth of compensation.
Employees can opt to have this change in payment cycles, and the accompanying temporary decrease in wages, occur any time between October 2016 and October 2017, though it will by default occur in October 2017.
Callan, the president of the group representing staff, said support for the new effort is mixed. They worry, she said, how some departments will complete their work confined to the bounds of a 40-hour week without overtime.