This week, the Department of Labor (DOL) announced a proposal to increase the Fair Labor Standards Act's (FLSA's) salary-level threshold for exempt employees from $35,568 ($684/wk) to $55,068 ($1,059/wk).
As a reminder, to be exempt from the minimum wage overtime rule under the FLSA's white-collar exemptions, employees generally must be paid on a salary basis, meet a minimum salary, and meet specific exempt job duty requirements. The DOL is also proposing automatic increases every three years to the salary threshold. The DOL is seeking comment on the proposed rule for 60 days.
If this proposal passes, it will have a significant impact on employers by making more employees eligible for overtime (DOL estimates 3.4 million more people will be eligible), unless employers increase salaries to meet at least the new minimum requirement. Similar to the last time the DOL adjusted the salary threshold, it was clear that there is no exception for small employers or non-profits. Also worth noting, the proposal did not make any changes to any of the “duties” tests under the FLSA.
Cascade will continue to keep you updated as new information emerges.