On September 24, 2019, the Department of Labor issued a final rule increasing the salary-level threshold for white-collar exemptions from $455 a week to $684 a week. This final rule is effective Jan. 1, 2020. 

Employees covered by the Fair Labor Standards Act must receive at least time and one-half their regular pay rate for all hours worked over 40 in a workweek unless they meet the requirements for one of the overtime exemptions. 

Employers are advised to evaluate not just whether changes will be necessary, but how best to make those changes (timing, communications, etc.).  You should:

  • Analyze whether the FLSA exemptions you have will still apply;
  • consider the application of alternative FLSA exemptions; and
  • develop FLSA compliant pay plans for employees you intend to re-classify to overtime eligible (non-exempt).

Employers should remember that applicable state law may impose a higher minimum salary requirement or a more onerous duties test. Employers in those states must continue to comply with state law.

Federal Register for the Final Notice
DOL Fact Sheet
Small Entity Compliance Guide
DOL’s Webinar: FLSA Part 541 – Overtime Final Rule – 2019 Public Presentation Recording
DOL’s Presentation Slide Deck – FLSA Part 541 – Overtime Final Rule – 2019 Public Presentation Slide Deck (PDF)

For more information contact us.