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DOL Anticipates Late 2016 Issuance of Final Overtime Exemption Rules

    Client Alerts
  • December 14, 2015
Earlier this year, the federal Department of Labor proposed an increase in the minimum salary required to claim exempt status from the Fair Labor Standards Act’s overtime requirements under its Part 541 “white collar” exemption rules. The proposed rules would more than double the current salary minimum to over $50,000 per year, and index that level to inflation, meaning that it would automatically increase in future years without the need to issue new regulations.

In November, DOL issued its regulatory agenda for 2016, listing an anticipated date for issuance of the final overtime exemption rules in July. DOL has received over 300,000 comments on its proposal, and in addition, the final rule must pass Office of Management and Budget review before final approval. OMB review frequently results in delays in issuance of final regulations beyond the date anticipated by the promulgating agency.

Based on this estimate, the new minimum salary level would become effective late in 2016 at the earliest. Anticipated lawsuits seeking to block implementation of the new salary level could further delay its effective date. Employers budgeting for possible salary increases for exempt employees may see a later starting date for such moves than was previously estimated.