In a Proposed Rule published in last week’s Federal Register, the U.S. Department of Labor (DOL) asked for feedback from the public, including employers, on its plans to update the Fair Labor Standards Act (FLSA) overtime rules.
Specifically, the DOL is asking for feedback on the following 11 questions:
- Would updating the 2004 salary level for inflation be an appropriate basis for setting the standard salary level and, if so, what measure of inflation should be used?
- Should there be multiple salary levels? If so, how should they be set (by size of employer, census region, etc.)?
- Should there be different salary levels for the executive, administrative, and professional exemptions?
- Should the salary level be set within the historical range of the short-test salary level, at the long-test salary level, between the short- and long-test salary levels, or should it be based on some other methodology?
- Does a standard salary level of $913 per week work effectively with the standard duties test or does it eclipse the role of the duties test in determining exemption status?
- How did employers respond to the 2016 overtime rule?
- Would a test for exemption that relies solely on the duties performed by the employee without regard to the amount of salary paid by the employer be preferable to the current standard test?
- Does a $913 per week salary minimum exclude from exemption particular occupations that have traditionally been covered by the exemption?
- Should non-discretionary bonuses and incentive payments (including commissions) be allowed to satisfy up to 10 percent, or some other percentage, of the standard salary level?
- Should there be multiple total annual compensation levels for the highly compensated employee exemption and, if so, how should they be set?
- Should the standard salary level and the highly compensated employee total annual compensation level be automatically updated on a periodic basis to ensure that they remain effective, in combination with their respective duties tests, at identifying exempt employees?
The DOL’s 2016 rule would have increased the minimum salary for white-collar professionals from $23,660 to $47,476. On November 22, 2016, Judge Amos Mazzant of the federal U.S. District Court for the Eastern District of Texas enjoined the rule, preventing it from taking effect on December 1, as scheduled. With the change in administration, the rule’s future has been uncertain.
Employers have until September 25 to submit comments through the Federal eRulemaking Portal. Comments should include the Regulatory Information Number (RIN) 1235-AA20 and can also be mailed to Melissa Smith, Director of the Division of Regulations, Legislation, and Interpretation, Wage and Hour Division, U.S. Department of Labor, Room S-3502, 200 Constitution Avenue NW., Washington, DC 20210.