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The United States Department of Labor (DOL) has announced that the much-anticipated new rules under the Fair Labor Standards Act (FLSA) which will increase salary thresholds for exempt employees will not be released until late 2016. The DOL reports that it received over 250,000 comments regarding the proposed rules, and additional time is needed to review these comments. Employment lawyers predict this late release will result in a shorter compliance period, suggesting that employers may only have between 30-60 days after the final rule is published to implement changes. Another possibility being discussed is phased-in effective dates. The decision on the effective date(s) for the new regulations no doubt will depend on the 2016 election, given the controversy surrounding these new rules.
On June 30, 2015, the Wage and Hour Division of the DOL issued a notice of proposed rulemaking for rules that could dramatically reduce the number of exempt employees under the white-collar exemptions of the Fair Labor Standards Act. The white-collar exemptions apply to professional, executive and administrative employees, as well as certain computer analysts, programmers and engineers.
The proposed rule has the following major changes:
Although there are several issues related to the proposed rules that are impossible to predict at this time, it is fairly certain that the salary thresholds will substantially increase and that many positions that currently are classified as exempt will no longer meet the salary requirements of these exemptions.
To prepare for the new rules, employers should:
For more information on how this could impact your business, contact:
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