As you know, under the FLSA 541 Regulations, an employee qualifies as exempt from the overtime requirements if he or she satisfies a “duties test” (does specific job responsibilities under the executive, administrative, professional, computer and outside sales regulations) and the employee is paid on a “salary basis” (that is, salary does not fluctuate based on hours that the person works). Under the current regulation, the employee must be paid a salary of $455 per week to meet the salary basis test. If the changes to the overtime regulations are made, it will fall to the Labor Department’s wage and hour administrator to put them into effect.
Although we still know little about what changes to the duties tests the administration will propose, it is likely that the changes will touch almost every employer and employee in the country. At this time, it is not clear whether the change to the FLSA will be issued as a proposed regulation from the Department of Labor (which is the normal process for a change of this magnitude) or an Executive Order from the administration, as a formal proposal has not yet been released by the administration.
According to press reports, the proposal will likely include an increase to the “salary basis” amount from $455 a week “by a significant amount.” This means that a substantial number of employees currently classified as exempt from the overtime requirements would be eligible for overtime pay.
Source: SHRM
This information is intended to be
educational and should not be considered legal advice on any specific matter.
