A Sneak Peak at the New Overtime Rule

By Lehr Middlebrooks Vreeland & Thompson, P.C.

March 1, 2019

As we all painfully remember, in 2016, the Obama Department of Labor proposed revisions to the overtime rule which would have raised the salary threshold for the white collar exemptions from $23,660 to more than $47,000.  A federal judge put a hold on the new regulations at the last minute and then the newly-inaugurated Trump administration pulled the regulations for further review.  Since then, rumors have swirled as to what the new regulations might look like.  Most agreed that the salary threshold should increase, but the question was by how much.  And should there be regional differences and automatic adjustments based on cost of living?
 
In January, the Trump DOL finally sent its proposed overtime regulations to the White House for executive review, but it has not yet publicly disclosed what changes they would make.  Although the proposed rules have not been announced officially, we have it on good authority that they will raise the salary threshold to $35,000.  There will be no regional difference based on cost of living and there will not be an automatic adjustment.  The new rules will likely require the Secretary of Labor to review the threshold every three years, but any change would have to be made through the rulemaking process.
 
This should be welcome news to employers as the salary threshold is much more realistic than the 2016 proposal and employers won't face the threat of an automatic increase every year.