For those of you wondering when the Department of Labor’s (DOL) new overtime salary basis thresholds will become effective, we are one step closer to an answer. This week the DOL submitted the rules to the Office of Management and Budget (OMB), the last step before the rules become effective and raise the salary basis test to approximately $50,000. The old rule required employers to pay white collar exempt employees on a salary basis of at least $455 a week ($23,660 annually). The new rule sets the salary basis at the 40th percentile of weekly earnings for full-time, salaried workers (a number that will change over time), which is projected to be $970 a week ($50,440 annually).
OMB typically reviews rules in a couple of months, so we could be looking at a new rule before the summer. You need to review your white collar exempt employees and make sure they will be at this new salary level soon or convert them to a nonexempt status and start paying them overtime.