UPDATE: Too Fast, Too Soon? House of Reps. Take First Step to Delay DOL’s Quest To Raise The Overtime Salary Threshold

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11/23/2017

Hi Visitor,

 

UPDATE: Too Fast, Too Soon? House of Reps. Take First Step to Delay DOL’s Quest To Raise The Overtime Salary Threshold

By Gregory Blueford

As an update to our June 14, 2016 eblast, the U.S. House of Representatives recently passed a bill to delay the Department of Labor’s (“DOL”) rule which is currently set to raise the threshold for exemption to overtime pay, effective December 1, 2016.

As a refresher, the new DOL rule will nearly double the minimum salary threshold to qualify for the federal  overtime exemption for “white collar” employees from $23,660 to $47,476 per year. If enacted into law, the bill would delay the implementation of the rule until June 2017 so that employers have additional time to prepare for the sharp increase in the exemption threshold. Employers argue that the new rule would force them to lay off many employees in the face of increased payroll costs. Opponents to the bill have said that the current $23,600 threshold is outdated and no longer does its job of separating the low wage workers who deserve overtime from workers who make enough money and should be exempt. Opponents also believe that this delay is the first step in an attempt to have the rule repealed altogether.

The bill still has a long way to go before becoming law though.  It will have to go to through the Senate and, if passed there, must go before the President, who has threatened to veto the bill.

COUNSEL TO MANAGEMENT:

As we stated in our previous eblast, when there is differentiations between California and Federal law, California employers must comply with the salary-basis overtime exemption that is more favorable to employees. California’s overtime exemption currently stands at $41,660 per year; therefore, delaying this bill will have less immediate effect on California employers. Also, as another reminder, employees exclusively employed in primary agricultural operations are exempt from FLSA’s overtime provisions, so this federal rule would not apply to them anyway.

With that said, employees should keep abreast of where this bill goes and if its proponents can successfully convince the Senate and President Obama that delaying the enforcement of the DOL’s rule will ultimately benefit employees in the long run. As of now, it appears proponents of the bill have an uphill battle. Please contact The Saqui Law Group with any questions regarding overtime compensation.
 

 

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