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Just when you thought it was safe to pay white-collar professionals a salary $455/week, the Department of Labor (DOL) has filed papers indicating their intent to rewrite the Obama-era overtime rules.

As a reminder, the previous administration proposed raising the salary level for professional, executive and administrative exempt employees from $455/week to $913/week effective last December (2016).  There was an inflation adjuster built into the increase as well, meaning future increases would become rote.  A federal judge in Texas, however, stopped the DOL from implementing the regulations as part of a lawsuit brought by opponents.  The Trump administration then entered and the DOL stopped fighting the lawsuit, effectively putting a stop on the implementation of the regulations.

Now the DOL is indicating they want to make changes to the Obama-era regulations which never were put into effect.  What changes they want to make, however, is anyone’s guess. We have some vague idea as to the major pressure point.  Without question the Trump administration thinks moving from $455/week in salary to $913 is too much, too fast.

Outside the salary level it is unclear what changes the new administration wants to see in new overtime rules.  What is clear though is that the new administration is planning to do something, meaning businesses should be prepared for the DOL to seek to raise the salary level somewhat.  Whether an inflationary adjuster will be included or whether there will be a more widely sweeping overhaul of the duties tests that delineate who is performing as an executive, professional or administrative exempt employee is currently unknown.  Change is coming.  We just don’t know yet what it will look like.

Thompson Coe and myHRgenius Tip of the Week is not intended as a solicitation, does not constitute legal advice, and does not establish an attorney-client relationship.


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