Testifying before Congress, Department of Labor (DOL) Secretary Thomas Perez acknowledged that it will take “a few more months” for his department to rewrite the rules for who is eligible for overtime at work.
“We want to make sure that our proposal, which we expect to release in the coming months, is informed by as many stakeholder views as possible,” Perez told the House Education and Workforce Committee.
Overtime rules are controlled by the Fair Labor Standards Act (FLSA), which established overtime pay as 1.5 times the normal hourly wage rate for all work beyond 40 hours in a week, but the qualifying standards can be reinterpreted by the DOL as the economic environment changes.
The last rewrite of overtime rules came in 2004 under the Bush administration when the salary threshold for an overtime exemption was set at $455 a week, or a mere $23,600 a year. The Obama DOL will likely raise the bar on the salary requirement, with speculation pegging the amount at $40,000 a year or more.
The FLSA also specifies that overtime exemptions can be allowed for personnel who are executives, managers and professionals — terms that are also open to reinterpretation. The Obama DOL is expected to specify how much time a supervisor must spend managing to qualify for the exemption.
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