The U.S. Department of Labor (DOL) has issued a new proposed rule raising the salary level requirements for the white collar exemptions. A full article discussing the proposed rule will be published later but here is what you need to know now:
- The new standard salary level will be $35,308 annually ($679 per week). This is an increase from the current level of $455 per week, but less than the now-invalid Obama-era rule, which was $913 per week.
- The DOL will permit employers to satisfy the new salary level requirement by using nondiscretionary bonuses and incentive payments (including commissions) to satisfy up to 10% of the salary level test. This would be an addition to the current regulations but a similar provision was included in the Obama rule.
- The new salary level for the Highly Compensated Employees (HCE) will be $147,414, which is higher than under the Obama-era rule. The current level is $100,000 and the level under the Obama-era rule was $134,004.
- There are no changes to the duties requirements.
- There are no automatic increases, but the DOL proposes that the salary level will be revisited every four years.
- The new salary level does not apply to employers in Puerto Rico, the Virgin Islands, Guam, and the Commonwealth of the Northern Mariana Islands; the current salary level of $455 will continue to apply.
DOL expects that the new rule will be effective January 2020. Comments will be received for 60 days after it is published in the Federal Register.