Sets Salary Threshold at $35,308
Yesterday, the U. S. Department of Labor’s (DOL) Wage and Hour Division (WHD) announced a Notice of Proposed Rulemaking (NPRM) updating the Fair Labor Standards Act (FLSA) overtime regulations. This new proposal would update the salary threshold using current wage data, projected to January 1, 2020. The result would boost the standard salary threshold for exempt employees from $455 to $679 per week (equivalent to $35,308 per year). The NPRM comes following a 2017 Request for Information (RFI) and is in line with AGC’s formal recommendations.
Specifically, the NPRM includes:
- The proposal increases the minimum salary required for an employee to qualify for exemption from the currently-enforced level of $455 to $679 per week (equivalent to $35,308 per year);
- The proposal increases the total annual compensation requirement for “highly compensated employees” (HCE) from the currently-enforced level of $100,000 to $147,414 per year;
- A commitment to periodic review to update the salary threshold. An update would continue to require notice-and-comment rulemaking;
- Allowing employers to use nondiscretionary bonuses and incentive payments (including commissions) that are paid annually or more frequently to satisfy up to 10 percent of the standard salary level;
- No changes overtime protections for:
- Laborers including: non-management production-line employees
- Non-management employees in maintenance, construction and similar occupations such as carpenters, electricians, mechanics, plumbers, iron workers, craftsmen, operating engineers, longshoremen, and construction workers;
- No changes to the job duties test; and
- No automatic adjustments to the salary threshold.
AGC will continue to provide input to the DOL on the impact this update might have on the construction industry and will notify members of any developments.
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