The Department of Labor just published revisions to the overtime exemption regulations that are expected to cause more than 4 million workers to lose their exempt status. Department of Labor is more than doubling the minimum weekly salary level for employees to be exempt from FLSA overtime under the “White Collar” exemptions.
  • Current minimum is $455/week or $23,660 annually
  • The new minimum is $913/week or about $47,500 annually
The new regulations take effect on Dec. 1, 2016, so employers have some time to make adjustments.


Next Steps

Step 1.
Before the new rules take effect, identify all employees classified as exempt whose salaries are less than $47,476 per year.
Step 2. 
Consider available options and determine your course of action. Remember, you don’t have to do it all alone – leverage your business resources! Talk to your HR Pro to understand available options. Consult your payroll advisor when making necessary compensation changes in the payroll system. Keep in mind that leading payroll providers often offer automated timekeeping solutions that can help you track employee time  and make overtime calculations easier. For some positions on the border of the the minimum salary level, you may want to require timekeeping as a “safety net.”
Step 3.
Implement a solution to ensure you are in compliance with the new regulations. Talk to your HR Pro to ensure your new company policies are in compliance with the state laws as well as with new FLSA regulations. Make sure to communicate planned changes to your employees and your payroll and benefit partners way in advance to ensure smooth transition.
Other resources
Department of Labor’s Wage and Hour Division |
Department of Labor’s Guide on the FLSA |