Overtime Exemption Update

FLSA Increases Salary Threshold for Exempt Employees

Effective January 1, 2020, the Fair Labor Standards Act (FLSA) has issued an updated salary threshold for employees who are considered exempt from overtime. Here is what employers need to know:

  • Workers who do not earn at least $35,568 a year ($684 a week) would have to be paid overtime, even if they’re classified as a manager or professional.
  • Non discretionary bonuses and incentive payments (including commissions) paid on an annual or more frequent basis may be used to satisfy up to 10 percent of the standard salary level.
  • Highly compensated employees require an annual compensation of at least $107,432 ($684 of which must be paid weekly on a salary or fee basis).
  • No changes to the duties tests. Employers are urged to conduct these regularly.
  • The DOL intends to regularly update the salary threshold. Updates will not be automatic and would continue to require notice-and-comment rule making.

Exemption Questionnaire

Click here to download an exemption questionnaire for salary exempt and non-exempt evaluations.

Fact Sheet

Click here to access a downloadable fact sheet on federal exemptions.

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Email: megan@onboardhro.com