On May 23, the U.S. Department of Labor (DOL) published in the Federal Register its long-awaited final rule implementing new minimum salary thresholds for the “white collar” exemptions to the Fair Labor Standards Act’s (FLSA) overtime requirements. On Sept. 20, 21 states and the U.S. Chamber of Commerce, joined by numerous business groups, filed separate lawsuits seeking to enjoin the final rule from taking effect on Dec. 1.
Background
The most significant aspect of the DOL’s final rule more than doubles the minimum salary level for employees to qualify for the executive, administrative, and professional exemptions to overtime pay to $47,476 per year ($913 per week) from the current level of $23,660 per year ($455 per week). The minimum salary amount for the highly compensated employee exemption also was increased to $134,004 per year from $100,000 per year. The final rule permits up to 10 percent of the required salary to be met through payment of nondiscretionary bonus, commission, and/or incentive compensation so long as such compensation is paid at least quarterly. No discretionary payments can be counted toward the 10 percent.
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