Monday, July 18, 2016
Posted by: Liz Szlaga
The Department of Labor recently updated the Fair Labor Standards Act (“FLSA”) to increase the salary level required for the executive, administrative and professional (“white collar”) exemptions.The change raises the salary level from its previous level of $455 per week (the equivalent of $23,660 per year) to a new level of $913 per week (the equivalent of $47,476 per year).The salary level is automatically adjusted each year.The changes take effect December 1, 2016.Establishing that a white collar employee is exempt from the FLSA minimum wage and overtime requirements involves assessing how the employee is paid (Salary Basis Test), how much the employee earns (Salary Level Test) and whether the employee primarily performs the type of duties that qualify for exemption (Duties Test).All three tests must be met.Receiving a salary, alone, does not indicate that an employee is exempt from overtime and minimum wage protection.Job titles never determine exempt status under the FLSA.The Department of Labor has prepared an extensive summary of the overtime final rule entitled “Guidance for Private Employers on Changes to the White Collar Exemptions in the Overtime Final Rule.”www.dol.gov/whd/overtime/final2016/general-guidance.pdfWithout repeating the entire guidance provided, the Department of Labor does indicate there are certain options for compliance with the new rule.
Click here to view a summary of the Overtime Regulations.
Click here to view the FLSA White Collar Exemption Changes Approved- Are you ready?
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