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U.S. Dept. of Labor Proposes Extension of Overtime Protections

The United States Department of Labor has announced a proposed rule that it claims would extend overtime protections to nearly five million white collar workers within the first year of its implementation.

The Fair Labor Standards Act (FLSA) currently requires that most employees in the U.S. be paid at least a minimum wage and overtime pay at time and one-half the regular rate of pay for all hours worked over 40 in a work week. However, the FLSA provides an exemption from both minimum wage and overtime pay for individuals employed as executive, administrative, professional, outside sales and computer employees.

Generally speaking, to qualify for the exemption under the FLSA, employees must meet certain tests regarding their job duties and be paid on a salary basis at not less than $455 per week. The proposed changes would increase the salary level required for the exemption from $455 a week ($23,660 annually) to $970 a week ($50,440 annually). The proposed increase would be of particular significance in New York State, since the standard weekly salary level required for the overtime exemption in New York is currently $656.25 (scheduled to increase to $675 a week on 12/31/15). The DOL also proposes automatically updating the salary level to prevent it from becoming outdated.

The DOL is now asking for comments with respect to the proposed changes which it hopes to implement in 2016.

Should you have any questions on this or other employment-related matters, please contact Mr. Kimler at 516.437.4385, x122, or akimler@vmmlegal.com.