Department of Labor Issues New Overtime Rule

Date: October 1, 2019

The Department of Labor posted a news release on Sept. 24 announcing a final rule regarding overtime pay in the Fair Labor Standards Act (FLSA).

The rule updates the earnings thresholds so as to, “exempt executive, administrative, or professional employees from the FLSA’s minimum wage and overtime pay requirements and allows employers to count a portion of certain bonuses (and commissions) towards meeting the salary level.” The DOL will:

  • Raise the “standard salary level” from $455 to $684 per week (equivalent to $35,568 per year for a full-year worker).
  • Raise the total annual compensation level for “highly compensated employees” from $100,000 to $107,432 per year.
  • Allow employers to use nondiscretionary bonuses and incentive payments (including commissions) that are paid at least annually to satisfy up to ten percent of the standard salary level.
  • Revise the special salary levels for workers in U.S. territories and in the motion picture industry.

“For the first time in over 15 years, America’s workers will have an update to overtime regulations that will put overtime pay into the pockets of more than a million working Americans,” Acting U.S. Secretary of Labor Patrick Pizzella said. “This rule brings a commonsense approach that offers consistency and certainty for employers as well as clarity and prosperity for American workers.”

The rule will go into effect on Jan. 1, 2020.

Printer-friendly version