The Department of Labor has released its final rule “Defining and Delimiting the Exemptions for Executive, Administrative, Professional, Outside Sales and Computer Employees” which outlines updates to the Department’s overtime rule. The rule goes into effect December 1, 2016. These changes include:
- An increase in the standard exemption from $455/week to $913/week or approximately $47,476 per year (40th percentile of lowest-wage census region)
- An increase in the highly compensated employee threshold from $100,000 per year to $134,004 per year (90th percentile of national workers)
- Both exemptions will be tagged to the 40th percentile and 90th percentile, respectively, and automatically increase every three years
- The rule provides NO consideration for seasonal spikes in work and the use of “comp time” to compensate for increased work load in busy season.
- The one silver lining: there were no changes to the duties test
A summary of the final rule analysis can be found here. The AICPA will be meeting with the Partnership to Protect Workplace Opportunity on Friday, May 20th to discuss next steps. We will relay any useful information from that meeting to members as quickly as possible.