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New Overtime Regulations Move Closer to Final Rule and Implementation

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As we’ve blogged earlier this year, employers should begin preparing for what appears to be the inevitable passage of new overtime regulations which will significantly change the face of overtime as we currently know it. The Department of Labor’s (DOL) proposed overtime rule, which calls for a more than doubling of the salary level threshold for white collar exemptions (jumping from $23,660 to $50,440 per year), was anticipated to go into effect much later on this year given all of the legislative maneuvering it would encounter. However, and perhaps in an effort bypass what many perceived might be an end run by Congress to delay or affect the issuance and implementation of the final rule, the DOL instead sent its proposed rule to the White House Office of Management and Budget (OMB) for review, well ahead of the expected schedule. The OMB’s review typically lasts 30-60 days, and once the review is completed and released, the regulations will likely go into effect 60 days thereafter, and published in final form by July 4.

Like everything else in Washington, this may be subject to change, particularly if a Republican candidate is elected president. However, and we are warning our contractor employers once again, the impact these regulations will have on employers will be widespread. Not only would the salary threshold more than double in terms of being exempt from overtime, the DOL may also redefine the types of duties employees may perform to qualify for the exemption. Employers may have to redesign their pay structures and reclassify employees from being exempt, to nonexempt. As an employer, you know how much this will impact your basic payroll, and the administrative tasks associated with making sure you are in compliance with the law will significant.

Stay tuned as this major legislation gets closer to be declared law.

Hilary Atkins

Posted In: Legal, Management, Money

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