Department of Labor Overtime Rules Have Been Updated

DEPARTMENT OF LABOR ANNOUNCES THE FINAL FLSA WHITE COLLAR OVERTIME EXEMPTION UPDATES.

The U.S. Department of Labor released the final updates to the Fair Labor Standards Act’s White Collar Overtime Exemption. Here are the key points every employer needs to know about the new rule:

  • The new salary threshold for “Exempt” employees will be $47,476 annually. Any exempt employee earning a salary below this number could be affected. This is an increase from the current threshold of $23,660 annually.
  • Salaried employees making below the $47,476 threshold will be owed overtime pay for any overtime hours worked.
  • The effective date of the new rule is December 1, 2016.

Additionally, the new rule amends the salary basis test to allow employers to use non-discretionary bonuses and incentive payments (including commissions) to satisfy up to 10 percent of the new standard salary level.

Future automatic updates to the new salary threshold will occur every three years, the first one effective January 1, 2020.

For more information, and if you feel this new rule will impact your business, please contact your DMS Manager for assistance.