New Overtime Rule Released by the Department of Labor

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On May 18, 2016, the Department of Labor released the long anticipated final regulations regarding the exemption from overtime pay.

What you need to know:

  • New rule raises the salary threshold from $455/week and $23,660/year to $913/week and $47,476/year – (estimated by DOL to affect 76,000 workers in Washington State and 4.2 million in the USA).
  • The salary threshold amount will be updated automatically every three years, based on wage growth over time.
  • No changes to the duties test for Executive, Administrative and Professional employees.
  • Effective December 1, 2016.

What you need to do:

  • Identify exempt employees paid less than $913/week and $47,476/
  • Take the opportunity to determine if these folks actually meet the duties test of an Executive, Administrative or Professional employee. (Maybe consult with experienced employment lawyer about this!)
  • Make a decision whether to
    • raise pay above threshold amount, or
    • pay overtime over 40 hours, or
    • limit hours to 40 in a week. AND
  • Attend the Helsell Fetterman Spring Employer Breakfast briefing about this very topic on June 2nd!!! Sign up here: http://www.helsell.com/helsell-news/spring-employment-labor-breakfast/

About the Authors

Michael Harrington

Michael Harrington has over 20 years of experience representing employers with union employees and those facing union organizing campaigns. Mike focuses his practice on labor and employment issues affecting the workplace. He has a broad experience conducting collective bargaining for employers in health care, construction, transportation, retail, manufacturing and the public sector.

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