By: Christina M. Reger
It’s here – the time has come. It is the moment I have been preaching about. The Department of Labor has issued new regulations regarding overtime. Several significant changes:
The overtime pay threshold: The DOL proposes that the minimum weekly salary to qualify for an exemption under the Fair Labor Standards Act be set at $921 per week ($47,892 annually). In 2016, that number will increase to about $970 a week ($50,440 a year).
The highly compensated employee threshold was also impacted: The total annual compensation requirement needed to exempt highly compensated employees would climb approximately 22% from $100,000 to $122,148 — or the 90th percentile of salaried workers’ weekly earnings.
The salary threshold will no longer remain stagnant: For the first time ever the salary thresholds will be tied to an annual increase without further rule-making. The DOL is proposing using one of two different methodologies to do this — either keeping the levels chained to the 40th and 90th percentiles of earnings, or adjusting the amounts based on changes in inflation by tying them to the Consumer Price Index.
Still up for grabs: The duties related test: The Department of Labor has not (YET) changed any of the exemptions’ requirements as they relate to the kinds or amounts of work performed. In its proposed rule, the DOL seeks comment on whether to adjust the duties test to something more quantitative. Some discussion on this topic has been requiring that a certain percentage of an employee’s time be spent performing an exempt primary duty. Said another way, a certain percentage (50% or higher for example) cannot be spent on non-exempt duties.
Now, once you catch your breath remember, this is not the law – YET. So, plan ahead. Think about your workforce as it relates to your needs, and then call me.
Helpful Resources published by the Department of Labor
http://www.dol.gov/whd/overtime_pay.htm?utm_source=The+Employer+Handbook&utm_campaign=0b98a5c1b7-Email_Newsletter&utm_medium=email&utm_term=0_97bdd2bd3b-0b98a5c1b7-12283989
In case you can’t get enough of this stuff
http://www.wage-hour.net/post/2015/06/30/Proposed-Regulations-Published-Salary-Floor-Would-Be-Doubled.aspx
President Obama’s bylined column in the Huffington Post
http://www.huffingtonpost.com/barack-obama/a-hard-days-work-deserves-a-fair-days-pay_b_7691922.html
