On May 23, 2016, the U.S. Department of Labor published its new overtime regulations that will require most employers, including many nonprofits, to pay overtime to all employees earning less than $47,476. The Overtime Final Rule goes into effect on December 1, which for many nonprofits will be during the performance period of their existing written agreements with governments to deliver certain services. This timing is significant not only for nonprofits with grants or contracts issued by local, state, tribal, or federal governments, but also for members of the public who rely on services those nonprofits provide.
Recognizing that the sector as a whole earns almost a third (32.5 percent) of all revenues from government grants and contracts, the National Council of Nonprofits conducted a national survey seeking insights from nonprofits with government grants and contracts about how changes to federal employment law could affect their costs and operations. The survey focused on those organizations because of both the likelihood they will face common challenges in complying with the new regulations while fulfilling service obligations on behalf of governments, and the extensive work of the network of the Council of Nonprofits on the topic of government grants and contracts. More than one thousand individuals (1,094) from all 50 states responded. Survey participants were generally representative of the nonprofit community at large.