On May 18th, the U.S. Department of Labor (DOL) released a final rule updating overtime regulations, extending overtime pay protections to over 4 million workers within the first year of implementation.
Under the new rule, millions more workers are expected to be made eligible for time-and-a-half pay when they work more than 40 hours per week.
Basically, in accordance with the Fair Labor Standards Act (FLSA), overtime rules have effectively doubled the salary threshold at which most salaried workers become exempt from having to be paid overtime, raising it from $23,660 to $47,476.
The DOL set the new salary level equal to the 40th percentile of weekly earnings for full-time, salaried workers in the lowest-wage Census region of the country, currently the southeast.
Salary thresholds will be automatically updated every three years to prevent the salary limit from becoming outdated.
A free, special report from Business Management Daily is available for download, detailing the specifics of the new overtime rules and offering information on how your business can comply. Topics covered include: defining “hours of work;” Exempt vs. nonexempt status; how to properly classify workers; and how to compute overtime. The effective date of the final rule is December 1, 2016.
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