Follow-Up to New USDOL Proposed Overtime Regulations

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george pic for news.jpgCAI recently published an article in its July 6th CAI Management Newsletter about the U.S. Department of Labor’s (USDOL) newly proposed rule that would revise the regulations concerning the Fair Labor Standard Act’s (FLSA) minimum salary test for white collar exemptions.  This proposed rule was published in the Federal Register on July 6, 2015 (Federal Register Volume 80, number 128).


We reported that one of the major changes included in the proposal calls for an increase to the minimum salary level for the executive, administrative, and professional exemptions from $455 per week—$23,660 annually—to $970 per week, annualized to $50,440 (figure based upon the 40th percentile of first quarter 2016 weekly earnings for full-time salaried workers).


Our article noted that the proposed rule also increases the minimum salary exemption for highly compensated employees from $100k to $122,148 a year based on the 90th percentile in 2013.   If the USDOL sticks with the 90th percentile methodology for 2016, this number could increase to over $128k. 


As reported, the USDOL didn’t make any proposals regarding the various “primary duty” tests. It is, however, requesting comments on whether or not the current tests allow exempt employees to perform excessive amounts of non-exempt work.  The agency is evidently concerned that some exempt employees spend a disproportionate amount of time performing non-exempt work.  Comments are also requested on whether to include a portion (10%) of an exempt’s non-discretionary bonus to meet the proposed new minimum salary requirement and should the USDOL add examples to its list of exempt and non-exempt occupations.


PLEASE SUBMIT COMMENTS!  Employers interested in making comments to this rule can do so here (the site works better using the Chrome browser).  The 60 day comment period will end on September 4th, 2015 unless it is extended.  Only comments received during the comment period identified in the Federal Register published version of the Notice of Proposed Rule Making (NPRM) will be considered part of the rulemaking record.


CAI will keep you informed as this proposed rule saga continues.

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