UPDATE – In our blog post on July 14, 2015, we described the Department of Labor’s proposed updates to the FLSA’s overtime regulations. As of today, May 18, 2016, President Obama and Secretary of Labor Thomas Perez announced the publication of the DOL’s final rule updating the overtime provisions, which will now extend automatically to cover more than 4 million additional workers within the first year of implementation.
Key Updates to the Final Rule
- Sets the minimum salary threshold required to qualify for the Fair Labor Standards Act’s “white collar” exemption to $47,476 per year. (You may recall that in the proposed rule, the Department of Labor had recommended setting this exemption at $50,440.)
- Additionally, the salary threshold will be automatically updated every three years to ensure it stays at the 40th percentile benchmark.
- The final rule will also raise the overtime eligibility threshold for highly compensated workers from $100,000 to about $134,000. Importantly, for the first time employers will be able to count bonuses and commissions toward as much as 10 percent of the salary threshold.
The final rule will become effective on December 1, 2016. The final rule does not make any changes to the duties test for executive, administrative and professional employees.
Feel free to reach out to the author, Anthony Bova, or any of the other experienced employment-law attorneys at Conn Kavanaugh should you have any questions.