How to Prepare for the Proposed FLSA Overtime Rule

Author: XpertHR Editorial Team

The US Department of Labor (DOL) plans to amend the Fair Labor Standards Act (FLSA) regulations to:

• Increase the minimum annual salary for most exempt employees paid on a salary basis from $35,568 per year to match the 35th percentile of weekly earnings of full-time nonhourly workers in the lowest-wage Census Region (which is projected to be somewhere between $55,068 per year and $60,209 per year);
• Increase the minimum annual salary for highly compensated employees who face a looser duties test to match the 85th percentile; and
• Adjust these minimum salary levels for inflation every three years.

An estimated 3.6 million workers who are currently overtime-exempt are projected to become eligible for overtime unless their employers raise their salaries, reorganize workloads, adjust work schedules or spread work hours in order to avoid paying overtime.

To prepare for the FLSA overtime rule, an employer should consider taking the following steps.