Feel Like Screaming Already?
The New Federal Overtime Rule Explained
The federal Department of Labor raised the minimum salary required to keep workers exempt from overtime to $35,568 per year ($684/week) from $23,660 per year effective January 1, 2020. Keep in mind that, in addition to meeting the salary threshold, employees’ work must meet the “duties tests” required for overtime exemption. Paying employees at the minimum salary threshold, alone, is not sufficient to make an employee exempt from overtime.
Still concerned? You can do a couple of quick checks to maintain your company’s compliance:
- Look at the employees who you consider to be exempt and see who falls below the new $35,568 threshold ($684/week).
- If those employees regularly work enough overtime to elevate their pay above the threshold, consider increasing those salaries to $36,000 or more to clear the threshold.
- Make sure that, in addition to meeting the salary threshold, any employees who you treat as “exempt” also meet the “duties tests” required to claim the exemption.
- The rules differ for highly compensated employees and those paid by commission – Fact sheets from the Department of Labor are available here for more information.
Want some specialists to take a look at your exempt and non-exempt employees? Need to update your employment agreements and handbook to reflect the changes? Reach out to Council Baradel Employment Lawyers Susan Stobbart Shapiro (ranked by Super Lawyers as one of the top 100 attorneys in the state), and Tova Z. Brody (who headed an HR department for a business with 120 employees prior to becoming an attorney) to answer your questions and ease you into the new year.