On March 7, 2019 the U.S. Department of Labor announced a Notice of Proposed Rulemaking (NPRM) to make more than a million Americans eligible for overtime pay. Under current law, Americans making $455 per week (23,660 annually) must be paid overtime if they work over 40 hours a week. The proposal would be updating the 2004 rule and increase that salary threshold from $455 to $679 per week ($35,308 annually) bringing higher wages to Americans.
As proposed, the rule would:
- Increase the minimum salary required for an employee to qualify for exemption from the currently-enforced level of $455 to $679 per week (equivalent to $35,308 per year).
- The proposal increases the total annual compensation requirement for “highly compensated employees” (HCE) from the currently-enforced level of $100,000 to $147,414 per year.
- Commit to periodic review to update the salary threshold. An update would continue to require notice-and-comment rulemaking.
- Allow employers to use nondiscretionary bonuses and incentive payments (including commissions) that are paid annually or more frequently to satisfy up to 10 percent of the standard salary level.
- Not change overtime protections for:
- Police Officers
- Fire Fighters
- Laborers including: non-management production-line employees
- Non-management employees in maintenance, construction and similar occupations such as carpenters, electricians, mechanics, plumbers, iron workers, craftsmen, operating engineers, longshoremen, and construction workers
- Not change to the job duties test.
- Not make automatic adjustments to the salary threshold.
The proposal is now open for public comment and will remain open for public comment for 60 days. To submit a comment, click this link, in the rule-making docket RIN 1235-AA20.
More information about the rule can be seen here.