The U.S. Department of Labor (DoL) has proposed changes to the white collar exemptions to federal overtime pay requirements. In the proposal, DoL is considering raising the minimum salary threshold to $970 per week ($50,440 annually); an increase of more than 100 percent. DoL also proposed increasing this minimum salary on an annual basis by pegging it to the 40th percentile or by indexing it to inflation for urban goods and services. DoL proposes publishing these annual increases to the minimum salary only 60 days before they become effective—providing employers and employees with far too little notice.
IPC is working with the PPWO to urge the administration to reconsider its rulemaking and proposed minimum salary threshold. The Partnership is also urging the department to neither index the salary threshold nor make changes to the primary duties test until the public is able to comment on specific proposed changes. Please use the coalition’s to reach out to DOL tell them the proposed rulemaking will only hurt the employees the administration is looking to help.
Currently, an employee must satisfy three criteria to qualify as “exempt”: first, they must make a salary; second, that salary must be more than $455/week ($23,660 annually); and third, their “primary duties” must be consistent with managerial, professional or administrative positions as defined by DoL. While DoL did not offer a specific proposal to modify the primary duties tests, the department suggested it is considering making some rather extreme changes.
The magnitude of the increase to the salary level proposed by DoL and almost any changes to the duties test will hurt small businesses, schools, municipalities, nonprofits and other employers, as well as workers and the economy as a whole. Many employees would lose the flexibility they currently enjoy, employers would be faced with crushing increases in labor and administrative costs, businesses would suffer with low employee morale, and the American people would experience jumps in prices for goods and services as well as diminished customer service. In an already stagnant economy, these consequences will be devastating.
Please click here to contact both DoL and your members of Congress about this important issue.