Update on proposed overtime rule comes to a halt
April Fools! Well not entirely… On March 14th, the US Department of Labor [DOL] submitted its final changes on the proposed overtime regulations to the Office of Management and Budget [OMB]. Later that week on March 17th, Congress presented legislation to stop the proposed regulations in its tracks.
According to WorldatWork’s most recently published article on the overtime regulations, the newly proposed Protecting Workplace Advancement and Opportunity Act would demand that the DOL complete a thorough economic analysis on the effects of the proposed overtime regulations on all businesses including public, private, nonprofit, and small business employers.
If the bill does not pass, then the DOL may move forward with its review, which may take weeks to months before being finalized, and the updated rulings will have to take effect within 60 days of the publishing date.
As a reminder, the key provisions of the DOL’s proposed rule are:
- Raising the threshold under which most salaried white collar workers are guaranteed overtime. As proposed, this would raise the salary threshold from $455 a week [$23,660 a year] to a projected level of $970 a week [$50,440 a year] in 2016.
- Increasing the total annual compensation requirement needed to exempt highly compensated employees [HCEs] to $122,148 annually.
- Providing greater clarity for employers so they can determine more easily if they should be paying overtime compensation.
- Automatically updating the salary threshold based on inflation or wage growth over time.
What should you do to get ready? Organizational Architecture can provide assistance to ensure your company is ready to take action once the proposed overtime ruling takes effect. To learn more, contact us on our website.
Also, check back with us on our blog for new updates regarding the proposed overtime ruling and other new postings on workforce strategy.