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Overtime Rule Regulations Finalized: What's Changed

Posted by Richard J. Pfentner CPA

Jun 2, 2016 11:30:00 AM

As a follow up to our previous blog, the Department of Labor (DOL) has finalized changes to the Fair Labor Standards Act (FLSA) regarding overtime pay for executive, administrative, professional, outside sales and computer employees. It becomes effective December 1, 2016 .

The Current State of Overtime Exemption

The FLSA guarantees a minimum wage and overtime pay at a rate of not less than one and one-half times the employee’s regular rate for hours worked over 40 in a workweek. Under the current regulations, employees with pre-determined and fixed salaries above a threshold of $455 per week or $23,660 annually and who perform certain job duties are exempt from overtime pay requirements.

Who will be eligible for Overtime on 12/1?

The key provisions of this final rule include increasing the exempt level by setting it at the 40th percentile of earnings of full-time salaried employees ($913 per week or $47,476 annually) and the total annual compensation requirement for highly compensated employees from $100,000 in total annual compensation to the 90th percentile of earnings of full-time salaried workers nationally ($134,004 annually). Automatic updating is also a key provision which includes a mechanism to automatically update the standard salary level requirement every three years as a way of providing an effective means of distinguishing between overtime-eligible white collar employees and those who may be valid executive, administrative, professional employees.

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Topics: overtime, dol, department of labor, fair standards lablor act, FSLA



DOL Proposed Changes to Overtime Regulations

Posted by Karen D. Costa CPA

Oct 1, 2015 12:59:00 PM

The Fair Labor Standards Act (FLSA) guarantees a minimum wage and overtime pay at a rate of not less than one and one-half times the employee’s regular rate for hours worked over 40 in a workweek.  The Department of Labor (DOL) proposed changes to the FLSA related to overtime pay for executive, administrative, professional, outside sales and computer employees. 

Under the current regulations, employees with pre-determined and fixed salaries above a threshold of $455 per week or $23,660 annually and who meet certain job duties are exempt from overtime pay requirements. 

The proposed changes increase this exempt level to the 40th percentile of earnings for full-time salaried workers ($921 per week or $47,892 annually, in 2013*) and the threshold for a highly compensated employee from $100,000 in total annual compensation to the 90th percentile of earnings for full-time salaried workers ($122,148 annually, in 2013*). Both of these thresholds would be adjusted annually.

What does this mean to you and/or your workforce? Please contact me or Liz Bidjov with any questions.

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Topics: dol, department of labor





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