October 1, 2015 – The Fair Labor Standards Act (FLSA) guarantees a minimum wage and overtime pay at a rate of not less than one and one-half times the employee’s regular rate for hours worked over 40 in a workweek. The Department of Labor (DOL) proposed changes to the FLSA related to overtime pay for executive, administrative, professional, outside sales and computer employees.
Under the current regulations, employees with pre-determined and fixed salaries above a threshold of $455 per week or $23,660 annually and who meet certain job duties are exempt from overtime pay requirements.
The proposed changes increase this exempt level to the 40th percentile of earnings for full-time salaried workers ($921 per week or $47,892 annually, in 2013*) and the threshold for a highly compensated employee from $100,000 in total annual compensation to the 90th percentile of earnings for full-time salaried workers ($122,148 annually, in 2013*). Both of these thresholds would be adjusted annually.
*The Department relied upon 2013 data in the development of the proposed change. The Department will update the data used in the Final Rule resulting from this proposal, which will change the dollar figures.
About the Author
Karen D. Costa CPA
Karen, Assurance Services Director and Co-Leader of the Dopkins Not-for-Profit and Healthcare Teams, has lengthy experience with both for-profit and not-for-profit healthcare organizations specializing in auditing, revenue cycle consulting and certification of their Medicaid cost reports and specialized compliance audits.