Compliance Bulletin

DOL More Than Doubles Salary Test for Overtime Pay
July 5, 2016

The Wage and Hour Division of the U.S. Department of Labor’s overtime regulation will present employers with significant challenges. Exempt employees who will not meet the new threshold of $913 per week or $47,476 per year must either be re-classified as non-exempt or given higher salaries to remain exempt. Both options are fraught with challenges. Employees losing their exempt status must be paid overtime for work they currently perform above the limits. Raising pay above the threshold causes pay compression. And larger companies may find that the same position in different worksites will be classified as exempt or non-exempt depending on local market conditions. See CBA’s Regulatory Compliance Bulletin for more information.