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DOL’s New Overtime Rule – The Good News

The salary threshold was lowered.  The final rule states the minimum annual salary an employee has to be paid to be considered exempt under the FLSA is $913 per week or $47,476 per year (assuming they meet the duties test to qualify for an exemption).  Why make the threshold $47,476?  The new threshold of $47,476 represents the 40th percentile of earnings in the lowest wage census region.

Nondiscretionary bonuses count toward the threshold.  The final rule amends the salary basis test to allow employers to use nondiscretionary bonuses and incentive payments (including commissions) to satisfy up to 10% of the new $47,476 salary level.

The duties tests will not change.

You get more time to comply.  The final rule says employers have until Dec. 1, 2016 to get their payroll processes in order. That’s a little over six months.

Who do you go to when you need HR compliance assistance? 

Let HR Solutions help you with your HR compliance needs.


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