The Department of Labor has released the final rules regarding pay and overtime requirements. This rule was proposed during the Obama Administration and has been in litigation since then.  However, we now know several important findings:

1. The new salary minimum for exempt employees is $35,568 annually or $684 per week.
2. The “duties” test for the Fair Labor Standards Act must be followed.
3. As previously, job titles do not meet the requirement for exempt/salaried status.
4. Highly compensated employee cap is now $107,432 annually. Part of that total may include, in some instances, incentives, bonuses, etc.
5. These changes become effective January 1, 2020.

It has taken 10 years to effect this change. The DOL has committed to more frequent updates to the thresholds in the future, although no specific timeline was stated.

So, what does an employer need to do?  All job descriptions and pay for each position should be reviewed to determine what changes are required and for which employees.  Positions that will move to exempt or from exempt to non-exempt must be reviewed and decisions made regarding communicating this change to each affected employee.   It may not be good news for some.

The team at The Hopkins Group is ready to assist companies as they make these decisions and move into compliance with the DOL by the upcoming deadline. We can provide a complete audit with necessary revisions to job descriptions and assist in planning for and communicating any changes in compensation and pay structure for affected employees.  The new year is rapidly approaching so contact us right away!