On September 24, 2019, the U.S. Department of Labor
announced a final rule under the
Fair Labor Standards Act (FLSA) to make 1.3 million
American workers eligible for overtime pay.
More than 143 million American workers are protected (or
"covered") by the FLSA.
The FLSA applies only to employers whose annual sales
total $500,000 or more or who are engaged in interstate
commerce. A few
employers, including small farms (those that use relatively
little outside paid labor) are explicitly exempt from the
FLSA.
Under the FLSA “Non-Exempt” employees are entitled to
overtime pay and compensatory time.
“Exempt” employees are exempt are generally not
entitled to overtime pay and compensatory time.
Exempt employees are paid a salary rather than a wage and
they perform administrative, executive or professional
duties. State
laws also regulate other qualifications for Exempt
employees.
These are the key changes that will take effect in January
1, 2020:
1.
raising the “standard salary level” from the currently
enforced level of $455 per week to $684 per week (equivalent
to $35,568 per year for a full-year worker);
2. Raised the
total annual compensation requirement for “highly
compensated employees” (Exempt employees) from the currently
enforced level of $100,000 per year to $107,432 per year;
3. Allows
employers to use nondiscretionary bonuses and incentive
payments (including commissions) paid at least annually to
satisfy up to 10% of the standard salary level, in
recognition of evolving pay practices; and
4. Revising the
special salary levels for workers in U.S. territories and
the motion picture industry.
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