Proposed Changes to Federal Overtime Rules

On March 7, 2019, the U.S. Department of Labor issued a Notice of Proposed Rulemaking (NPRM) that “would make more than a million more American workers eligible for overtime.” Interested individuals and companies have 60 days to comment on the proposed regulation once it is published in the Federal Register.

Key provisions of the NPRM include:

  • Increases 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).
  • Increases the total annual compensation requirement for “highly compensated employees” (HCE) from the currently-enforced level of $100,000 to $147,414 per year.
  • A commitment to periodic review to update the salary threshold. An update would continue to require notice-and-comment rulemaking.
  • Allowing 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.
  • No changes overtime protections for:
    • Police Officers
    • Fire Fighters
    • Paramedics
    • Nurses
    • 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
  • No changes to the job duties test.
  • No automatic adjustments to the salary threshold.

More information is available through the DOL website: https://www.dol.gov/whd/overtime2019/