U.S. Department of Labor (DOL) Proposed Overtime Rule

April 18, 2019

On March 7, 2019 DOL released a notice of proposed rulemaking to raise the salary level at which employees must be paid overtime if they work more than 40 hours per week. This has the potential to impact Counties as employers of 3.6 million people and service providers to 314 million residents nationwide. The public comment period for the proposed rule is open through May 21, 2019.

Current enforced law stipulates that non-exempt employees with salaries below $455 per week ($23,660 annually) must be paid overtime if they work more than 40 hours per week. This salary level was set in 2004. Under the new proposal, the salary threshold before employees must be paid overtime would be raised to $679 per week ($35,308 annually).

The new proposal would not impact existing overtime exemptions under the Fair Labor Standards Act (FSLA) for law enforcement, firefighters, teachers and certain other employees who meet job duties criteria for administrative, executive, and professional employment. Lists of exemptions by exemption and occupation can be found here.

The original overtime rule dates to the passage of the Fair Labor Standards Act of 1938. The salary threshold at that time was an annual salary of $1,560 and had limited professional exemptions. The rule has been updated periodically since that time.

In 2016, the Obama Administration published a rule to raise the threshold for the first time since 2004. Ten days before implementation, the U.S. District Court for the Eastern District of Texas approved a preliminary injunction filed by 22 states to halt the proposal. The U.S. Circuit Court of Appeals for the Firth Circuit has held an appeal in abeyance pending further rulemaking since 2017.

The full proposal from DOL and ability to submit formal comments can be accessed here. The National Association of Counties (NACo) has further information and suggestions for submitting comments here.

VACo Contact: Jeremy R. Bennett

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