The Department of Labor’s New Rules Regarding White-Collar Exemptions to Minimum Wage and Overtime Pay Requirements of the Fair Labor Standards Act
The Department of Labor (the “DOL”) has issued the long-awaited Final Rule that affects the “white-collar” exemptions to the minimum wage and overtime pay provisions of the Fair Labor Standards Act (“FLSA”). The Final Rule is effective on January 1, 2020.
The Final Rule increases the minimum required salary for a “white-collar” exemption from $455 per week to $684 per week (equivalent to $35,568 per year for a full-time, full-year employee). This means that for any employee to be eligible for a “white-collar” exemption, that employee must be paid a minimum salary of $684 per week regardless of the number of hours or days that employee has worked in the week.
Further, the total annual compensation level required for highly compensated employees has been increased from $100,000 to $107,432 per year. Finally, employers are permitted to use nondiscretionary bonuses and incentive payments (including commissions) that are paid at least annually to satisfy up to 10 percent of the standard salary level.
Please contact the Arefin Law Office to discuss how your company should prepare for the new Rule.
