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Overtime Regulations




On June 30, the U.S. Department of Labor (DOL) released its proposed regulations in regard to federal overtime laws. The regulations require that overtime pay be granted to employees who earn less than $50,440 a year (or $970 per week), as opposed to the current ceiling of $23,660 per year (or $455 per week). Further, the language permanently links wage increases to insure that 40 percent of the working population is eligible for overtime pay.

In addition to an income threshold increase, the DOL solicited questions from the public about how best to alter the current "duties test," which exempts certain executive, administrative and professional employees from overtime requirements. This is particularly troublesome, as the DOL can issue a final rule amending the duties test without providing the public an opportunity to comment. If a change to the duties test is included, the Rule will likely face a legal challenge arguing  there was no proposed language to which to respond, however there is strong case law supporting the argument that, by soliciting broad questions,  the public was put on notice and  had an opportunity to respond.

If finalized in its current form, these regulations will drastically impact NFA members and their employees. A $50,440 salary threshold likely will cause employers to reduce workers' hours to save on overtime pay, offer lower wages to new hires and decrease the number of full-time jobs available.

While an extension of the deadline has been requested, the public currently has a 60-day window in which to provide comments before the final regulations are issued. This means that NFA members have until Friday, September 4, to voice their concerns over this proposalUse the NFA's template and click here to file your comments on the proposed overtime regulations with DOL!