DOL Set to Release New Overtime Rules

By:
Chris Gaetano
Published Date:
May 3, 2016
LateNew Department of Labor regulations that will expand who is eligible for overtime are set to be released later this month, according to CNN Money

Under current regulations, employees are generally considered exempt from overtime if they meet each of the following criteria: They’re paid a predetermined and fixed salary; they earn  $23,660 or more; and they have a job that primarily involves executive, administrative or professional duties. 


However, the Obama administration said these regulations haven't received a major overhaul since the 70s, with former president George W. Bush's reforms called "weak" in a White House fact sheet on the matter. 

Under the proposed rules, the exemption threshold would be more than doubled, jumping from $23,660 a year to $50,440 a year. In addition, the salary requirement for determining who counts as a “highly-compensated employee,” a category that is also exempt from overtime rules, would be increased from $100,000 a year to $122,148. Both thresholds would be automatically adjusted every year, either by a fixed amount yet to be determined, or alongside the consumer price index. 

CNN Money said businesses balked at the proposal, saying the numbers were far too high. In response to criticism, the final rule is expected to have an upper limit of $47,000 instead. CNN Money also noted that businesses can still find ways around the regulation. They could, for example, set salaries to bring workers below the threshold. Even if additional overtime is paid, CNN Money said businesses could cut benefits in other areas, such as bonuses. 

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