Yesterday, the U.S. Department of Labor announced a new proposal to raise the salary threshold to be exempt from the Fair Labor Standards Act, which requires employers to pay minimum wage and overtime. Currently, to be exempt, an employee must make a salary higher than $455 per week ($23,660 annually) and have certain professional, administrative, or executive job duties. The Labor Department proposes to raise this salary threshold to $679 per week ($35,308 annually). If this proposal becomes law, the Labor Department estimates that 1 million workers will lose their exemption and become eligible for overtime pay.

You may remember that in 2016 the Obama Administration’s Labor Department passed a similar rule to increase the salary threshold to $913 per week ($47,476 annually). In November 2016, a federal court halted that rule before it took effect and then the Trump Administration’s Labor Department rescinded it. 

Best & Flanagan’s Labor and Employment team will keep a close watch on how the new proposal advances. Please contact Sarah Crippen, Joel Schroeder, or Ashleigh Leitch with any questions.