Is This Our Last FLSA Update (For a While)?
A couple of times now I’ve posted a blog about proposed changes, or the cancellation of those changes to the minimum salary threshold for exempt vs. non-exempt employees.
Just last week, the Department of Labor rolled out changes that just might be the last ones that we will see for a while. In any case, they take effect on 1/1/2020, so if your organization is budgeting salaries for next year, you will want to take special note of this. Here’s the scoop:
Since 2004, the minimum salary requirement for exempt employees was $23,660 per year. While there have previously been proposals to increase it, no actual changes went into effect. That changed last week. The new minimum rate for exempt employees will increase to $35,568 per year effective 1/1/2020.
All exempt level employees will need to earn a minimum annual salary of $35,568. Of which, up to 10% can be earned through nondiscretionary bonuses and incentive payments.
As a reminder, compensation level is only one aspect of determining whether an employee is exempt or non-exempt. For an employee to be considered exempt, they must also pass the duties test to determine whether the actual work performed qualifies for the overtime exemption.
Here’s a link to the official announcement from the Department of Labor: https://www.dol.gov/whd/overtime2019/index.htm.
Have questions about whether your employees are exempt or non-exempt or have an exempt employee earning less than $35,568? Give us a call, we’d love to help!
if your organization is budgeting salaries for next year, you will want to take special note of this.