The Department of Labor (DOL) and its Wage and Hour Division (WHD) today published their proposed new overtime rules in the Federal Register, opening a public commentary period that will close 60 days after publication, on Sept. 4.
As announced last week by President Obama, the rule would set the threshold for exempt employee status at a salary of $970 a week, or $54,440 a year, with an automatic annual rider to increase the salary to match inflation.
Exempt employees do not earn overtime under the Fair Labor Standards Act (FLSA) of 1938. The current salary threshold, established in 2004, is just $455 a week, or $23,660 a year.
Though the rule more than doubles the salary threshold, the agency did not alter the duties tests that help determine whether an employee can be considered exempt. Instead, input is being sought from the public on whether the duties tests even need to be changed in light of the higher salary bar being established.
Specifically, the department is asking for comments on whether it should adopt the so-called “California rule” that would set a 50 percent maximum for non-exempt duties performed by exempt workers, which would also prohibit concurrent exempt and non-exempt work from counting toward the non-exempt duties threshold.
If you own or operate a small to medium-sized business, managing all your employees plus meeting federal labor laws and regulations can be daunting, especially with new rules being issued all the time. To help you understand your rights and responsibilities in every facet of running a business, please order a copy of Personnel Concepts’ All-On-One HR Compliance Program for Small Businesses.