Lincoln Makes Changes To Salary Scale For Overtime

LINCOLN — Like many businesses and other entities across the country, the city of Lincoln made changes to its salary scale to meet requirements for new rules that apply to overtime compensation.

Lincoln City Council approved a new salary scale at its Nov. 15 meeting, in time to meet the Dec. 1 deadline for when the new rules for overtime compensation, as set by the U.S. Department of Labor, were to go into effect.

A week later, however, a federal district court granted a nationwide preliminary injunction that stopped the Department of Labor from implementing the changes until the legality of the rule could be further examined. Twenty-one states, including Arkansas, sued to block the rule before it became effective.

Thursday, Steven Parker, city attorney, said the approved pay scale would remain in effect.

“They are continuing with what they decided,” Parker said. “Mostly because they’ve made the decision to go ahead and do that and it’s most likely inevitable anyway. They are just trying to be ahead of the game.”

The new rules apply to white- collar executives as well as administrative and professional workers, according to the U.S. Department of Labor. Under the rules, employers must either raise an affected worker’s salary to above the minimum or provide overtime compensation.

Rhonda Hulse with the city of Lincoln explained to council members that the city was recommending pay raises in a few positions so the person would be exempt from receiving overtime pay. She said city staff looked at each position to determine if it would be less expensive to increase the salary or to pay overtime.

To be considered exempt from receiving overtime under the new rules, positions have to meet several thresholds, Hulse said. For one, the annual salary for the position has to be at least $47,476. Currently, the annual salary is set at $23,660 to be exempt. The position also has to meet several duties tests, Hulse said, such as being a head of a department or supervising several employees.

Hulse said salaries were “bumped up” for four positions — the police chief, assistant police chief, city maintenance manager and office manager/grants administrator. The salary for the city information system director already was above the minimum required so the new rule did not affect this position.

In each of the four positions, Hulse said, it was less expensive for the city to increase the salary to meet the threshold and not have to pay overtime to the employees.

In the Police Department, for example, she said the city would have paid more than $21,000 in overtime to the police chief and assistant chief based on their overtime hours the past year. Instead, the city will pay an additional $9,628 to increase the salaries to meet the minimum threshold.

“We’re saving ourselves about $12,000 in the Police Department,” Hulse said.

In some cases, the city can limit overtime by telling employees they cannot work overtime, Hulse said. But in other instances, it cannot be avoided. If a water line breaks in the middle of the night, employees have to respond to that call, she noted.

“With the Police Department, they have to put in overtime,” she said.

The explanation about the new overtime law and salary scale generated discussions about salaries in general by City Council members.

City Council member Bobby McDonald noted the city did not increase salaries for 2016 and most employees would not receive raises for 2017.

“By this time next year, there needs to be a wage increase across the board,” McDonald said. “We need to look at salaries and show our appreciation for what they’ve done the past year.”

Mayor Rob Hulse agreed with him, saying, “This has to be the last year for no increases. We want to retain our people.”

Along with the salary discussion, the council voted to allow employees to decide when putting in overtime hours, if they would rather receive overtime pay or compensatory time off. Previously, city employees had to take comp time first. Once they maxed out on comp time, they would receive overtime pay.