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DOL Invites Public Comment on Overtime Rule

7/26/17

By: Paul H. Derrick

The U.S. Department of Labor has announced that it is formally seeking public comment on the 2016 compensation revisions in the regulations defining the federal Fair Labor Standards Act’s so-called “overtime rule” or “white collar” exemptions.

The overtime rule, which has been blocked by a federal court since November 2016, would require employers to pay certain executive, professional, and administrative employees at least $913 each week in order to avoid having to pay them overtime for all time worked beyond 40 hours in a work week. Under pressure from the business community, the Trump administration previously has suggested that the DOL would likely come up with a salary threshold that is lower than $913 per week but higher than the current level of $455.

The DOL’s announcement says that it is seeking input on 11 broad topics, including:

• Whether factors such as number of employees and geographic location should be considered in setting the salary threshold for a given employer;
• Whether executive, professional, and administrative employees should be subject to different salary thresholds;
• The extent to which employers had already increased salaries of exempt employees (to at least $913 per week) in anticipation of the overtime rule going into effect and what strategies might be in place to deal with employees who would have been eligible for overtime pay under the now-blocked rule;
• Whether an exemption test that relies only on duties (and does not consider salary) might be preferable, and, if so, which duties should be taken into account; and
• Whether and on what basis the compensation thresholds should be “automatically updated.”

A copy of the DOL’s request for public comment is available here. The 60-day comment period will end on September 25, 2017.

We will continue to keep you apprised of developments in this area as they occur. In the meantime, if you have any questions or would like more information, please contact Paul Derrick at pderrick@fmglaw.com.