New Overtime Rules Issued By The US Department of Labor
The US Department of Labor today released their much anticipated final overtime rules. The Fair Labor Standards Act requires that employees covered by the FLSA be paid at least one and one-half times their regular pay for all hours worked in excess of 40 in a workweek. However, many employees are exempt from these overtime requirements. To qualify for an exemption, an employee must:
1) Be paid on a salary basis
2) Be paid more than a specified minimum weekly salary level; and
3) Primarily perform executive, administrative or professional duties.
Learn more here about whether or not an employee can be paid on a salary basis.
The final rules, which take effect on December 1, 2016, will:
1) Raise the minimum salary level required to qualify for an exemption from $455 per week to $913 per week ($47,476 per year);
2) For the first time, allow employers to use nondiscretionary bonuses and incentive payments (including commissions) to satisfy up to 10% of the minimum salary requirement, provided that these payments are made on a quarterly or more frequent basis;
3) Increase the total annual compensation requirement for the highly compensated employees exemption from $122,148 to $134,004; and
4) Automatically update the minimum salary level every three years.
The Department of Labor estimates that the new rule will impact 4.2 million employees. Employers with exempt employees having salaries under $47,476 per year will need to be in compliance with the new rules by December 1, 2016.
The firm's Business and Employment Groups (Michael McConville and Mary Ognibene) and its Employment Litigation Group (Kevin Cooman, Peter Weishaar and Peter Gregory) can provide compliance analysis and counsel and litigation defense services with respect to FLSA matters.
This publication is intended as an information source for clients, prospective clients, and colleagues and constitutes attorney advertising. The content should not be considered legal advice and readers should not act upon information in this publication without individualized professional counsel.
McConville Considine Cooman & Morin, P.C. is a full service law firm based in Rochester, New York, providing high quality legal services to businesses and individuals since 1979. With over a dozen attorneys and a full paralegal support staff, the firm is well-positioned to right-size services tailored to each client. We are large enough to provide expertise in a broad range of practice areas, yet small enough to devote prompt, personal attention to our clients.
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