DOL Overtime Labor Rule Released

May 11, 2016

Provided by N.A.W.

The new overtime rule was released by the Department of Labor at 8:45 this morning.   You can access the full 500+ page rule here:  here.

Our overtime coalition attorneys are reviewing the rule now, and we will share their analyses with you as soon as we receive them.

In the interim, the Department of Labor has posted extensive information about the rule on their website, including useful fact sheets on various aspects of the rule – along with a lot of propaganda and claims that are dubious at best.  You can access this information here:

Of particular interest to us from our very preliminary review:

  • Bonuses and commissions will be allowed to satisfy 10% of the minimum salary threshold.  The inclusion of commissions is a surprise, as the Department apparently backed away from its prior position that all commissions were earned by sales personnel who are de facto non-exempt and therefore commissions would not be allowed to satisfy any part of the threshold.  
  • The bonuses and commissions can be paid quarterly, which is also an improvement from the proposed rule; and catch-up payments can be made within one week of the end of the quarter.
  • The rule will take effect December 1, 2016 – a 6-month period rather than the originally-proposed 60 days. 
  • The rule provides that the salary threshold will increase automatically every three years, not annually as originally proposed, and it will be tied to the 40th percentile of wages in the lowest wage region of the country.

In addition to preparing analyses of the rule, the overtime coalition is looking for employers and employees who would be willing to speak on the record to the media about the impact of the rule, especially in response to DoL claims that employers will not have difficulty tracking the hours of newly-hourly employees, so these employees will not be forced to punch time clocks; and that the rule will have no negative effect on worker flexibility.

Please let us know if you or any of your employees would be interested in participating in the coalition press effort by speaking on the record with reporters.

One final note:  as bad as this rule is, the changes from the original rule – bonuses, commissions, the delayed effective date, and the 3-year rather than annual salary adjustments – would certainly not have been made without the concentrated and coordinated effort of the employer community in making the case on the harm the rule will cause.   Thank you again for all the input you provided, and to the four member companies who participated directly in the meeting with the Administration.   We will not give up the fight to modify or repeal this rule, and will continue to look to you all for information on its impact.

We will forward further information on the rule as it becomes available to us.

To read NAW’s press statement on the rule, go to:

Press Release (PDF)

Many thanks.

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