Your apartment community can’t run itself. You may have landscaping staff, maintenance workers, and cleaning crews that help you keep Read More…
Paying a Fair Wage to Apartment Community Staff
Your apartment community can’t run itself. You may have landscaping staff, maintenance workers, and cleaning crews that help you keep your property clean and well-kept. How you pay these essential staff members can mean the difference between running a smooth operation or having an operations nightmare.
What is a fair wage? This will depend on the competitive rate for the same services in your area. Depending on your location, the minimum wage rate will differ, but many multifamily property owners seek to pay higher than the minimum wage to ensure workers are paid a livable wage and to keep them satisfied. In a recent May 18th ruling, the Labor Department lifted the overtime threshold from $23,660 to $47,476. Though this may seem like an insignificant ruling, it could mean higher expense costs for apartment community owners.
Previously, workers who made less than $23,660 were the only employees eligible for overtime pay. Now, employees that make up to $913 a week are able to get overtime pay for any hours worked over the standard 40 hours a week. For example, if a maintenance worker is paid an annual salary of $48,000, they would, under the law, not be eligible for overtime pay for the 41st hour and beyond. The apartment community owner could, of course, decide to pay them for the extra hours worked, but it is not a federal requirement.
It is estimated that this change in policy could result in an increase of wages by $12 billion over the next 10 years, since millions of workers who were once not eligible for overtime pay will now receive much-earned wages.
Industry leaders believe that this ruling could impact how apartment community owners pay their staff. Those that were once salaried, may be converted to an hourly wage and/or have their weekly hours cut so they are not within the eligible category. The overtime ruling only applies to full-time workers and only to those who work more than 40 hours a week. Higher employee wages could eat into apartment revenues, putting property owners’ profits at risk. How this congressional ruling will actually effect the apartment industry is yet to be seen, but apartment community owners should take note.
At Top Floor Insurance, we specialize in getting you competitive rates on your apartment community insurance. That way you do have more money to go towards business operations and paying overtime to your dedicated staff. If you are shopping around for multifamily property insurance, give the specialists at Top Floor Insurance a call at 404-266-3218 – we have the best coverage for a fraction of the cost of the other guys!