DOL Final Overtime Rule Published – Effective 1/1/20, Minimum Exemption Threshold Set at $35,568 Annually

David R. Bohm

By David R. Bohm

The U.S. Department of Labor (DOL) has finally issued its long-awaited final rule updating its regulations defining exemptions for executive, administrative, and professional employees.

Some of the key take-aways from the new regulation are:

  1. The “standard salary level” to qualify for the exemption has been raised from $455 per week to $684 per week ($35,568 annually). Employees paid less than this amount after January 1, 2020 will not qualify for the exemption and will have to be paid overtime for working more than 40 hours per week.overtime exemption
  2. The total annual minimum compensation level for “highly compensated employees” (“HCE”) has been increased from $100,000 to $107,432 annually.
  3. Employers may use nondiscretionary bonuses and incentive pay (including commissions) that are paid at least annually to satisfy up to 10% of the standard salary level.
  4. There are special provisions for workers in U.S. territories and in the motion picture industry.

Finally, the DOL has stated that it will more regularly update the standard salary and HCE minimum compensation levels than it has in the past.

Click here for a copy of the DOL’s Fact Sheet concerning the changes.

Posted by Attorney David R. Bohm. Bohm is an experienced litigator working with health care, government, and business clients on employment, intellectual property, and complex contract issues. He is also skilled in alternative dispute resolution as a means to solve disagreements without litigation. 


Comments RSS

Leave a Reply

Name (required)

Email (required)

Website

Speak your mind