News Summary
Rhode Island’s Department of Labor and Training has introduced new rules redefining ‘retail businesses’ and updating regulations on overtime and premium pay, effective August 17, 2025. The changes emphasize distinctions between retail and wholesale operations, altering how businesses calculate employee wages, particularly for overtime and holiday work. Retail establishments will benefit from simplified pay calculations. Employers are urged to evaluate their compensation practices to ensure compliance and fairness under the new regulations.
Rhode Island has announced new rules through the Department of Labor and Training (DLT) that will define “retail businesses” and update regulations concerning overtime and premium pay. These changes will go into effect on August 17, 2025. The regulation, identified as 260-RICR-30-05-2, specifically addresses the payment of wages, employer exemptions from weekly pay, and exemptions for work performed on Sundays and holidays.
Under the new rules, “retail businesses” are defined as establishments primarily engaged in selling goods or services directly to the general public. This definition positions retailers at the end of the distribution chain, selling small quantities to the ultimate consumer. Notably, the definition excludes operations primarily engaged in resale, wholesale transactions, or manufacturing.
Businesses that primarily prepare and sell food for immediate consumption, as well as wholesale operations, will not qualify as retail businesses under the new regulations. Employers in Rhode Island are advised to examine their operations and assess whether they meet this new definition, along with the compliance requirements that come with it.
The regulations stipulate that nonexempt employees are required to receive time-and-a-half pay for hours worked over 40 in a week, aligning with the federal Fair Labor Standards Act (FLSA). In addition to this, employees who work on Sundays or recognized holidays are also entitled to receive overtime pay at the same rate. Most employers must calculate overtime and Sunday or holiday premium pay separately, meaning that a non-retail employee who works 50 hours in a week, which includes 8 hours on a Sunday, would be compensated for both overtime and Sunday premium separately.
However, for retail businesses, the process has been simplified. These businesses can count the hours worked on Sundays or holidays against their overtime hours, which may provide a more favorable financial outcome for these establishments. For example, an employee at a retail business working 48 hours in one week, including 8 hours on a Sunday, will only be entitled to 8 hours of time-and-a-half pay that covers both their overtime and Sunday premium.
Additionally, the new regulations recognize the significance of collective bargaining agreements. If such an agreement exists within a retail business, employers must ensure compliance with its terms concerning premium pay for workers.
It is essential to note that while the DLT’s authority to grant exemptions from Sunday or holiday premium pay was removed in 2021, the new regulations eliminate procedures for requesting such exemptions moving forward. However, certain exemptions for specific employer groups remain intact. These include:
- Churches and houses of worship for work related to worship services.
- Employers of federally certified maintenance technicians at TF Green Airport.
- Manufacturers of monoclonal antibodies using mammalian cells.
- Motorist service facilities located near major interstate highways.
- Non-profit higher educational institutions along with certain other educational institutions.
- Private security guard businesses.
- Employees of fueling operators at Rhode Island Airport Corporation airports.
- Telephonic call centers or internet-based dispatch systems.
Employers are encouraged to promptly evaluate their pay calculation practices for Sunday and holiday premiums to ensure adherence to the new rules. This review process is integral not only for compliance but also for ensuring fairness and accuracy in wage distribution among employees.
As the effective date approaches, Rhode Island employers should actively engage with these regulations to guarantee compliance and adjust their compensation practices in accordance with the state’s new definitions of retail, wholesale, and related exemptions. This proactive approach will help minimize potential liabilities for businesses while also supporting fair employee compensation.
Deeper Dive: News & Info About This Topic
- National Law Review
- Littler
- JD Supra
- Providence Journal
- Patch
- Wikipedia: Rhode Island
- Google Search: Rhode Island labor laws
- Google Scholar: Rhode Island employment regulations
- Encyclopedia Britannica: Rhode Island
- Google News: Rhode Island overtime laws
Author: STAFF HERE PROVIDENCE WRITER
PROVIDENCE STAFF WRITER The PROVIDENCE STAFF WRITER represents the experienced team at HEREProvidence.com, your go-to source for actionable local news and information in Providence, Providence County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as WaterFire, Rhode Island International Film Festival, and Rhode Island Comic Con. Our coverage extends to key organizations like the Greater Providence Chamber of Commerce and Providence Warwick Convention & Visitors Bureau, plus leading businesses in finance and manufacturing that power the local economy such as Citizens Financial Group and Textron. As part of the broader HERE network, we provide comprehensive, credible insights into Rhode Island's dynamic landscape.
