Wednesday, August 23, 2017

New Overtime Wage Level Under Review

The Department of Labor (DOL) has announced they are putting the new overtime rule implemented under the Obama administration under review by putting out a Request for Information to the business community.

As most employers are aware, the Obama administration, through Executive Order, increased the salary level for non-exempt employees, (those employees subject to overtime) from $455 to $913 a week. This was a significant increase affecting up to an estimated 5 million workers. This rule was to go into effect Dec. 1. 2016 and created quite a stir in the business community as employers scrambled to comply as they worked on adjusting many employee's pay rate. On Nov. 22, 2016, responding to a suit filed by numerous State and business organizations, a federal court in Texas blocked the action from going into effect. It has been in legal limbo since, with many employers wondering how to proceed with their employment pay policies.

The DOL appealed the court decision and shortly thereafter announced the issuance of a Request for Information from the business community as the new DOL administration acknowledged that there is concern that the increase in the wage requirement may be too high. The DOL noted that employers have expressed significant concern that the new wage cap excludes too many workers who more than qualify for OT exemption based on the standard duties test (generally how much management responsibility do they have).

The Request for Information from the DOL consists of 11 questions that try to address items like:
  • What should the wage level be?
  • Should the wage level be tied to inflation?
  • Should it be determined on a regional basis as wage rates vary by region?
  • Should the wage level be tied more to responsibilities?
  • What kind of issues did businesses experience trying to comply with the new rule?

The DOL is looking for all businesses subject to the new rule to respond to this Request.

Written comments can be sent to the attention of:
Melissa Smith
Director of the Division of Regulations, Legislation and Interpretation
Wage and Hour Division
US Department of Labor
200 Constitution Ave. - Room S-3502
Washington DC 20210

The DOL also noted you can respond online using the Federal Government's site.Here is the specific site for this request and submittal.

The DOL noted that all responses need to be submitted by Sept 24, 2017. They also noted you do not need to answer all 11 questions.

Special thanks to for this great article.

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