 On July 6, 2015 the Department of Labor (DOL) announced proposed changes to the Fair Labor Standards Act, the law which outlines overtime exemptions for white collar workers. The proposed changes would extend overtime protections to nearly five million workers within its first year of implementation, making many positons which are currently considered overtime exempt under the act, nonexempt and eligible for overtime. This proposed change could be a costly one for employers, especially nonprofits that already operate on slim budgets.
One of the proposed changes to the current law includes raising the salary minimum of exempt status from its current $455 per week ($23,660 per year) to $970 per week (50,440 per year). This means that in most all cases an employee would need to earn at least $50,440 per year to qualify for exempt status, ineligible for overtime, under the proposed rules. Exceptions to this may include outside sales, teachers, doctors, and lawyers; however, for most general business positions this rule would apply. Another proposed change is related to the performance of the primary duties of the job. Currently, there is no specific time an employee has to spend on performing the primary duties of his or her job to qualify as exempt—it is to be used as a guide but it is not determinative. The proposed rule specifies that an employee must spend 50 percent or more of his or her time performing the primary duties of the job to qualify for the overtime exemption. This is a rule currently in place in California and the DOL seeks to adopt it. |
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