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Claim Your Free Copy of Overtime Primer: Highlights from the New Regulations

The federal DOL overtime regulations go into effect this year. Are you ready?


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This report includes a summary of key changes, including the salary level test and salary basis test.

As a bonus, we've included a handy flowchart to help you determine exemption status under the FLSA.

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November 23, 1999
Use-it-or-lose-it vacation: now it's a win-win 401k benefit
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your organization has a use-it-or-lose it vacation policy. Employees might not be too happy about it, but the organization believes it has to do it to contain future costs and insure people take a break once in a while. Well the IRS has just ruled that this potentially negative policy could actually become a plus for both employee and employer.

Under the new ruling the value of the unused leave can be put into the employee's 401k plan. The contribution won't count as wages for tax purposes, and neither will it be subject to FICA or Medicare taxes.

So employees should be happier - they don't lose when they fail to take vacation. And for employers, this feature takes the hard edge out of use-it-or-leave it policies. There is one restriction that applies: it's not permitted if the company provides an option to give cash for unused leave.

Featured Special Report:
Top 100 FLSA Overtime Q&As
   
   
 
 
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