The U.S. Department of Labor is expected to release a new overtime rule in May.
In the beginning of March, the Department of Labor submitted a final proposal for a revision to the FLSA (Fair Labor Standards Act) that would require overtime pay for all employees making less than $50,440 per year. Currently, salaried employees who make more than $23,660 are exempt from overtime requirements. This will be the second threshold that’s only been raised since 1975.
The pending FLSA will raise the annual salary for overtime-exempt, salaried employees from $23,660 to $48,000 or above (the final figure is expected in May).
What does it mean?
That means companies with salaries employees will have to make two choice: They should either meet the higher minimum salary or switch certain employees to hourly pay with overtime.