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Change in FLSA Status for Exempt Employee Letter

Authors: XpertHR Editorial Team, and Allen S. Kinzer, Vorys, Sater, Seymour and Pease LLP

When to Use

The sample letter below may be used to inform a once-exempt employee that he or she has been reclassified as nonexempt from the overtime requirements of the Fair Labor Standards Act. The employer's legal department should be notified first before any letter is sent out, because a change from exempt to nonexempt can result in liability for unpaid overtime.

NOTE: The US Department of Labor (DOL) has proposed regulations that would, if finalized, increase the minimum salary for most overtime-exempt employees from $455 per week to $679 per week (or from $23,660 per year to $35,308 per year). The proposed regulations also would allow employers to count nondiscretionary bonuses and incentive payments (including commissions) to satisfy up to 10% of the standard salary level test, as long as they are paid annually or more frequently. The DOL projects the regulations will take effect January 2020.

Customizable Letter