On Aug. 30, 2023, the U.S. Department of Labor (DOL) announced a proposed rule to amend current requirements employees in white collar occupations must satisfy to qualify for an overtime exemption under the Fair Labor Standards Act (FLSA).
The proposed rule was published in the Federal Register on Sept. 8, 2023. The general public must submit comments on the proposal by Nov. 7, 2023.
Increased Salary Level
The FLSA white collar exemptions apply to individuals in executive, administrative, professional, and some outside sales and computer-related occupations. Some highly compensated employees may also qualify for the FLSA white collar overtime exemption.
To qualify for this exemption, white collar employees must satisfy the standard salary level test, among other criteria. This salary level is a wage threshold that white collar employees must receive to qualify for the exemption.
The DOL is proposing to increase the standard salary level from:
- $684 to $1,059 per week ($55,068 per year); and
- $107,432 to $143,988 per year for highly compensated employees.
The DOL proposal also includes mechanisms that would allow the agency to automatically update the white collar salary level thresholds automatically every three years without having to rely on the rulemaking process.
The federal rulemaking process requires the DOL to allow the public to comment on proposed regulations before the agency adopts and implements final regulations.
For this rule, the DOL has established a 60-day comment period. The comment period for this proposal will close on Nov. 7, 2023. Those wishing to comment on the proposal must submit their feedback to the agency by this deadline.
Impact on Employers
The proposal does not impose any new requirements on employers at this time. However, employers should become familiar with the proposed rule and evaluate what changes they may need to adopt if the rule is implemented as proposed.
Previous SIMA Payroll News:
Disclosures: This content is not intended to be exhaustive, nor should it be viewed as legal or tax advice. Information presented is believed to be current and is provided for general information and educational purposes based upon publicly available information from sources believed to be reliable. We cannot assure the accuracy or completeness of this information. It is not intended as a thorough, in-depth analysis of specific issues, nor a substitute for a formal opinion, nor is it sufficient to avoid any penalties. You should always consult an attorney or tax professional regarding your specific legal or tax situation. This information may change at any time and without notice. All opinions represent the judgment of the author on the date of the post and are subject to change. Content should not be viewed as personalized advice. SIMA reserves the right to edit blog entries and delete comments that contain offensive or inappropriate language. ©2023 Zywave, Inc. All rights reserved.