The Fair Labor Standards Act (FLSA) establishes wage and hour regulations for employers. The Department of Labor (DOL)’s Wage and Hour Division (WHD) administers FLSA regulations and recently released the final rule increasing the salary threshold for the executive, administrative and professional exemptions from overtime payment under the Fair Labor Standards Act:
- Previous threshold set minimum salary a worker must be paid in order to be overtime-exempt as $23,660. The new rule increases the threshold to $35,568/annually, or $684 per week. This change is effective January 1, 2020.
- The new rule raises the total annual compensation level for “highly compensated employees” from $100,000 to $107,432 per year, effective January 1, 2020.
- No changes were made to the duties test.
- DOL has reaffirmed its intent to update the salary threshold more regularly going forward, but did not include any mechanism to automatically update the threshold.
- Identify impacted employees and analyze options for achieving compliance. Options will be reviewed on a case by case basis.
Approximately 70 employees are impacted.
- Following final determination, impacted employees and their supervisors will be notified, in December.
Impacted employees and their supervisors should familiarize themselves with FLSA guidance and resources to make the adjustments necessary to comply with non-exempt wage and hour rules.
University Implementation of New Rule
HR is actively working with unit leadership and supervisors to meet the DOL compliance deadline of January 1, 2020.
Please contact Classification & Compensation with questions at firstname.lastname@example.org.