On September 24, 2019, the U.S. Department of Labor announced a long-awaited final rule updating the earnings threshold workers need to meet to qualify for exemptions. The final rule raises the “standard salary level” from the current $22,660 annual salary ($455 per week) to $35,568 per year ($684 per week) for a full-time worker. Certain highly compensated employees also may be exempt from the Fair Labor Standards Act (FLSA). The highly compensated employee threshold will increase from $100,000 to $107,432. Additionally, this new rule allows employers to count non-discretionary bonuses and incentive payments (including commissions) towards meeting the salary level.
This is the first update to salary thresholds since 2004. This new rule will make 1.3 million American workers eligible for overtime pay. The rule is currently awaiting final publication in the Federal Register and is set to take effect on January 1, 2020.
Certain positions are exempt from the requirements of the FLSA based on their job duties and how they are paid. Generally, these positions are considered exempt as administrative, professional or executive and the determination is based on the actual job duties of the employee. In addition, regardless of the job duties, employees in these positions must be paid a minimum amount per week on a salary basis. An employee is paid on a salary basis if their weekly wages are the same regardless of the quantity or quality of worked performed.
The attorneys at Fishel Downey regularly work with Ohio employers to ensure compliance with the FLSA and, when necessary, the also defend employers in DOL investigations and in court. If you have any questions about complying with the FLSA, please contact please contact us at info@fisheldowney.com or call 614.221.1216.