News & Insights

Department of Labor Proposes Expansion of Overtime Protections
June 30, 2015
by Brett Hummer

 

South Bend / Mishawka, IN – On June 30, 2015, the U.S. Department of Labor issued a proposed rule aimed at broadening overtime pay regulations under the Fair Labor Standards Act (the “FLSA”). The proposed rule seeks to raise the minimum salary threshold required to qualify for the FLSA’s “white collar” exemption to $50,440 annually.

This proposed rule is a drastic departure from current regulations. At present, employees have to meet certain job duties-related tests and be paid at least $455 per week (i.e., $23,660 annually) to be exempt from overtime requirements under the FLSA exemption for administrative, executive, professional, outside sales, and computer employees.

The DOL’s proposal also recommends an automatic updating of the salary threshold in order to prevent it from becoming outdated between subsequent rulemakings. Importantly, the DOL’s proposed regulations do not contemplate changes to the duties test for the “white collar” exemptions. However, the DOL indicated it was considering whether changes to those tests were needed.

The DOL’s proposed rule will be open for public comment and could take months to finalize. In the meantime, employers should prepare for anticipated changes to the FLSA’s regulations in light of this proposed rule. Employers with questions concerning the FLSA should always consult with experienced legal counsel.

The content of this article is for information purposes only, and neither contains nor should be considered legal advice.

 

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