September 30, 2019

U.S. Labor Department Releases Final Rules For Overtime Pay

The U.S. Department of Labor last week released a final regulation that, once implemented, will increase a key salary threshold for determining which workers are eligible for overtime pay.

The changes will take effect on January 1, 2020 and, according to The Wall Street Journal, will make 1.3 million more U.S. workers eligible for overtime pay. Specifically, the final rule will:

  • Raise the “standard salary level” from the currently enforced level of $455 a week to $684 per week, a level that is equivalent to $35,568 per year for a full-year worker;
  • Increase the total annual compensation level for “highly compensated employees (HCEs)” from the currently-enforced level of $100,000 to $107,432 annually;
  • Allow employers to use nondiscretionary bonuses and incentive payments, including commissions, that are paid at least annually to satisfy up to 10 percent of the standard salary level; and
  • Revise the special salary levels for workers in U.S. territories and in the motion picture industry.

Click here to read the regulation in its entirety. Click here to read DOL’s fact sheet.