Informing Employees of a Change in Exemption Status

Employee & Labor Relations
Compensation Planning

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As HR Professionals, we are sometimes faced with the challenge of holding difficult employee conversations. Oftentimes what we have to do, want to do and should do conflict with one another, and balancing these competing issues may be difficult.

This concept certainly holds true when meeting with an employee to discuss a change in their Fair Labor Standards Act (FLSA) status from exempt to nonexempt. Employees often:

• View this change as a loss of workplace status or demotion

• Fear their employer no longer sees them as a professional

• Experience a change in benefits or loss in other incentives

• View “punching a time clock” negatively

Cumulatively, this may make for a difficult conversation. These best practices and helpful tips will keep the conversation on-track for the best possible outcome.