This morning (May 18, 2016), President Obama and Secretary Perez announced the Department of Labor’s final ruling on the proposed new overtime regulations that will extend protections to millions of additional workers currently classified as exempt. Virtually every business that classifies employees as exempt from overtime should conduct a review of its workforce and organizational chart as well as job descriptions, earnings, education and classifications of every employee who does not currently qualify for overtime for “all hours worked in excess of 40 hours in a workweek.” The following are the key changes:

  • The minimum weekly salary for an employee to be considered exempt from overtime is being increased from $455 per week to $913 per week;
  • The highly compensated employees (who generally are considered exempt without the duties test) salary threshold has been raised from $100,000 to $134,004 per year;
  • The DOL will increase the $913 salary threshold every three years beginning January 1, 2020; and,
  • Employers have until December 1, 2016 to comply with the new rule.

The entire DOL ruling can be viewed here.

It’s important that employers take steps now to be compliant by the December 1, 2016 deadline. If you need further clarification or an analysis of your company’s specific situation, please do not hesitate to contact the Axiom team.