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DOL formally starts process of revising OT rule

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in Employment Law,Human Resources

With the July 26 release of what’s known as a request for information—or RFI—the U.S. Department of Labor officially began a new effort to rewrite the rules that determine which exempt employees qualify for overtime pay when they work more than 40 hours in a workweek.

The RFI is an opportunity for the public to submit comments that will help the DOL formulate a proposal to revise the regulations that define exemptions from the Fair Labor Standards Act’s overtime requirements for white-collar employees.

Some of the topics on which the RFI seeks feedback relate to:

  • The FLSA’s salary and duties tests
  • Whether the salary test should vary depending on costs of living in different parts of the U.S.
  • Inclusion of nondiscretionary bonuses and incentive payments to satisfy a portion of the salary test
  • Automatic updating of the salary test, based on inflation.

Read the RFI and instructions on how to submit comments at s3.amazonaws.com/public-inspection.federalregister.gov/2017-15666.pdf. Public comments will be accepted until Sept. 25.

The rules that decide which exempt employees can receive overtime pay were last changed in 2004, when the current salary threshold of $455 per week/ $23,660 per year was set. In 2016, the Obama administration attempted to raise the threshold to $913 per week/$47,476 per year, but that rule—never enacted—is mired in a lawsuit that it is not expected to survive.

The first question posed in the RFI goes to the heart of the matter: How should the DOL determine the overtime salary threshold? It proposes indexing the figure to inflation. Using the 2004 threshold of $23,660 as a basis, that would work out to $30,552 now.

A sure-to-be-controversial question asks whether eligibility for overtime pay should be based “solely on the duties performed by the employee without regard to the amount of salary paid.”

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