DOL Proposes Rule Expanding Overtime Regulations

The Department of Labor (DOL) released a proposed rule for public comment that seeks to lift the income eligibility thresholds for some salaried workers working beyond 40 hours per week to receive time-and-a-half overtime pay.

• The standard salary threshold for exemption from overtime pay requirements would be raised 55 percent from its current level ($684 per week for most workers) to $1,059 per week ($55,068 per year), while the level for “highly compensated” workers would be raised by one-third from its current $107,432 to $143,998.
• DOL expects the rule change would transfer $1.2 billion of direct costs from employers to workers in the first year, predominately from higher overtime premiums and pay raises to maintain workers’ exempt status.
• Once finalized, the proposal is expected to face legal challenges similar to those which derailed a similar Obama Administration proposal in 2017 and also possibly directed at the extent of DOL’s rulemaking authority.