DOL Proposes to More Than Double the Minimum Salary Threshold for Overtime Pay Exemption

Under the FSLA’s current exemption, executive, administrative and professional employees, so called "white collar" employees, must meet certain job duties-related tests and earn at least $455 a week ($23,660 a year) in order to be exempt from minimum wage and overtime requirements. These current tests, along with exemptions for certain professionals, are described on the attached DOL fact sheet: http://www.dol.gov/whd/overtime/fs17a_overview.pdf.

The proposed minimum salary threshold increase to a projected level of $970 a week or $50,440 annually to be effective in 2016 is based on the 40th percentile of weekly earnings for full-time, salaried workers. The proposal also calls for automatic increases in the salary threshold going forward.

The DOL has not proposed any other changes in the duties test, but the proposal seeks public comments whether other duties test changes should be made and, if so, what those changes should address. The proposal also singles out California’s duties test approach, where 50 percent of an employee’s time must be exclusively spent on work that is the employee’s primary duty in order for that employee to be exempt from overtime pay. The proposal asks for comment on the possible Federal adoption of this requirement or whether some other threshold that is less than 50 percent of an employee’s time worked is a better indicator of today’s workplace.

ASAE plans to comment on the proposal, and AMCI is considering doing the same. However, both associations need your input regarding specific examples of how your business, as well as the associations you manage,  would be impacted by the proposed rule. Please provide these comments to AMCI headquarters via email at info@amcinstitute.org by August 3, 2015 to allow the needed time for these comments to be prepared. You may also wish to file individual comments on the proposal.

Rick Cristol/Wade Delk
Co-Chairs
AMCI Government Affairs Committee