Construction Industry Advisor – Fall 2016

Fall 2016_Page_1 Construction Industry AdvisorFall 2016

The New Rule on Overtime - Implications for Construction Companies

In May 2016, the U.S. Department of Labor finalized its controversial “overtime rule,” which doubles the minimum salary an employee must receive in order to qualify for the “white collar” exemption from overtime pay. According to the National Association of Home Builders, approximately 100,000 construction supervisors will be eligible for overtime under the new rule, currently scheduled to take effect December 1, 2016. This article offers an overview of the new rule. A sidebar warns of the dangers of employee misclassification.

Stopping the Scourge of Profit Fade

Profit fade — a gradual decline in expected gross profits over the course of a project — not only threatens to hurt financial performance, but also may raise a red flag with sureties and lenders. This article explains that, to avoid profit fade, construction companies need to identify its causes, monitor work in progress and act quickly to address any issues.

Zero Net Energy Building: Hot Trend Getting Hotter

Zero net energy (ZNE) buildings — both residential and commercial — are a sustainable construction approach in which the building has a much smaller energy impact. ZNEs have continued to show significant growth in recent years. In fact, the increase prompted the U.S. Department of Energy to release a common definition for ZNEs in 2015. This article examines just what ZNEs are and how the construction industry is implementing them.

Boost Retirement Benefits with a Cash Balance Plan

Construction business owners may not be able to set aside as much as they’d like in tax-advantaged retirement plans. Typically, they’re older and more highly compensated than their employees, but restrictions on contributions to 401(k) and profit-sharing plans can hamper retirement-planning efforts. This article describes how cash balance plans may help out.

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