DOL Publishes Proposed Rule for Updating the Executive, Administrative and Professional Exemptions

Hey Warriors and Bosses!

Today, the U.S. Department of Labor is announcing a proposal to Define and Delimit the Exemptions for Executive, Administrative, Professional, Outside Sales, and Computer Employees that would restore and extend overtime protections to many salaried workers. The proposal is currently available to the public on our website and will be followed by the publication of the Notice of Proposed Rulemaking (NPRM) in the Federal Register.

Specifically, the Department of Labor’s proposed rule would:

• Increase the FLSA regulations’ standard salary level from $684 per week ($35,568 per year) to $1,059 per week ($55,068 per year)
• Increase the total annual compensation requirement for highly compensated employees from $107,432 per year to $143,988 per year
• Restore overtime protections for U.S. territories, ensuring workers in those territories where the FLSA minimum wage applies have the same overtime protections as other U.S. workers
• Automatically update earnings thresholds every three years so they keep pace with changes in worker salaries, ensuring that employers could adapt more easily because they would know when salary updates would happen and how they would be calculated

The Department is not proposing changes to the standard duties test, consistent with its approach in both the 2016 and 2019 rules. At this time, the Department favors keeping the current standard duties test, which is well known to employers and employees. As long as it is paired with an appropriate salary level requirement, the standard duties test can appropriately distinguish bona fide EAP employees from nonexempt workers.

You can read a list of FAQs here: https://www.dol.gov/sites/dolgov/files/WHD/flsa/overtime-nprm-faqs.pdf