The Department of Labor issued its final rule doubling the salary level used to determine whether employees are exempt from overtime pay under the Fair Labor Standards Act. Starting on Dec. 1, the new salary level for exemptions will rise from $23,660 to $47,476, or $913 per week.
The final rule sets the salary threshold at the 40th percentile of earnings of full-time salaried workers in the lowest-wage region identified by the U.S. Census Bureau — currently the South. The salary threshold will automatically update every three years, instead of annually as proposed. The salary level for highly compensated employees — at which employers may conduct only a minimal duties test for exemption — will rise from $100,000 to $134,000. Up to 10 percent of the standard salary level can come from non-discretionary bonuses, incentive payments and commissions, paid at least quarterly.
Read more about the final rule in the DOL factsheet here.
IBA will offer a webinar on the new overtime exemptions on June 22. Click here for more information.