The U.S. Department of Labor (DOL) announced today it will publish a final overtime rule, setting the minimum salary threshold for overtime eligibility at $35,568. The regulations implement the Fair Labor Standards Act (FLSA)'s overtime mandate and, according to a senior DOL official, will make an estimated 1.3 million additional U.S. workers eligible for overtime pay. The final rule will be effective January 1, 2020.
The threshold is slightly higher that the $35,308 proposed in the initial draft of the rule and also will allow employers to count non-discretionary bonuses, incentives, and commissions as up to 10% of an employee's salary level, as long as those bonuses are paid annually. The FLSA's exemption threshold for highly-compensated employees will be set at $107,432, lower that in DOL's initial draft but still higher than the previous threshold of $100,000.
What is it?
The FLSA finalized a new rule that would increase the minimum salary requirement for exempt employees.
What does this mean for business owners?
Any employee on a salary less than $38,568 will now be eligible for overtime. Clients that don't want to raise their employee's salaries to the new minimum will need a system to track their hours and overtime.
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