On March 7, 2019, the Department of Labor released a long-awaited proposal to increase the minimum salary requirement for exempt employees from $23,660 to $35,308.  The DOL’s proposed rule comes nearly two months after it sent the rule to the Federal Office of Management and Budget for review – a story we previously reported about here.  

Assuming the proposed rule is adopted, to be exempt from overtime, an employee would need to be compensated on a salary basis at a rate of not less than $679 per week and perform the job duties required by the applicable “white-collar” exemption – namely, the executive, administrative, professional, outside sales, or computer professional exemption.   According to commentators, the increase in the minimum salary threshold would make 1.1 million additional workers eligible for overtime.

The proposed rule also contemplates a process to update the minimum salary threshold every four years.  The DOL has specifically requested input from the public on how this process should function.   

The proposed regulations will be formally published in the Federal Register next week.  After their publication, members of the public (e.g. employers, unions, business groups, workers’ rights groups, etc.) will have 60 days to comment on the proposed regulations.  Following the notice and comment period, the DOL may decide to amend its proposal based on the feedback it receives.  Alternatively, the DOL could keep its proposed rule intact.  

Readers will recall that in 2016, twenty-one states, the U.S. Chamber of Commerce, and several business groups filed a lawsuit to enjoin the Obama Administration from raising the minimum salary from $455 per week to $913 per week.  Many commentators believe this time around will be no different and readily expect both business and workers’ rights groups to mount legal challenges.

We will keep you updated on this developing story.   

March 7, 2019, the Department of Labor released a long-awaited proposal to increase the minimum salary requirement for exempt employees from $23,660 to $35,308.  The DOL’s proposed rule comes nearly two months after it sent the rule to the Federal Office of Management and Budget for review – a story we previously reported about here.  

Assuming the proposed rule is adopted, to be exempt from overtime, an employee would need to be compensated on a salary basis at a rate of not less than $679 per week and perform the job duties required by the applicable “white-collar” exemption – namely, the executive, administrative, professional, outside sales, or computer professional exemption.   According to commentators, the increase in the minimum salary threshold would make 1.1 million additional workers eligible for overtime.

The proposed rule also contemplates a process to update the minimum salary threshold every four years.  The DOL has specifically requested input from the public on how this process should function.   

The proposed regulations will be formally published in the Federal Register next week.  After their publication, members of the public (e.g. employers, unions, business groups, workers’ rights groups, etc.) will have 60 days to comment on the proposed regulations.  Following the notice and comment period, the DOL may decide to amend its proposal based on the feedback it receives.  Alternatively, the DOL could keep its proposed rule intact.  

Readers will recall that in 2016, twenty-one states, the U.S. Chamber of Commerce, and several business groups filed a lawsuit to enjoin the Obama Administration from raising the minimum salary from $455 per week to $913 per week.  Many commentators believe this time around will be no different and readily expect both business and workers’ rights groups to mount legal challenges.

We will keep you updated on this developing story.