USDOL issues Proposed Revisions
for “White Collar” Exemptions
295-page Notice of Proposed Rulemaking
At the end of last month the U.S. Department of Labor published recommended changes in the criteria for defining a white-collar employee that was exempt from overtime. President Obama announced that under the proposals five million additional workers would be eligible for overtime. The regulation declares that using its new minimums, the number of white-collar exempts would be reduced by fifty percent.
Under the wage and hour laws all white-collar exempts must be salaried. Hence, first on the DOL agenda is to raise the salary minimum. The minimum salary amount under the proposed new regulations would be set at the 40th percentile of weekly earnings for full-time salaried workers. Based on BLS data for 2013 this would amount to a minimum salary of $921 per week, or $47,892 per year.
Second, the DOL wants to increase the total annual compensationr requirement needed to exempt highly compensated employees to the “annualized value of the 90th percentile of weekly earnings of full-time salaried workers, i.e., $122,148 per year.
The DOL is soliciting comments from the public about including nondiscretionary bonuses to satisfy a portion of the standard salary test.
As to the duties tests, which are at the heart of the white-collar exemptions, the DOL proposes virtually nothing but instead asks the public what changes it might suggest. For example, the proposal asks whether employees should be required to spend a minimum amount of time performing the primary duty, and refers to the California wage law, which requires fifty percent.
Notice of proposed rulemaking: