Proposed Legislation Would See More Employees Eligible for Overtime
New legislation has been proposed that would increase the minimum salary basis level that employers need to pay as part of the requirements to avoid the overtime rules. Workers classified as executive, administrative or professional employees would have their weekly minimum pay more than doubled, and the floor for highly-compensated employees will increase too, by 25%.
The U.S. Department of Labor is reviewing new legislation to change overtime salary limits.
Right now, exempt executive, admin, and professional workers must earn at least $455 per week. This minimum lets employers skip overtime pay. But this may soon change. U.S. Department of Labor wants to raise the weekly salary floor in stages.
The plan may look like this:
- Week salary minimum rises to $1,090
- Salary will double for exempt job types
- Overtime must be paid if salary falls below the limit
This rise may roll out over 3 years. Employers won’t be able to avoid overtime rules unless they meet the new minimum pay level.
Changes for Highly-Compensated Workers
The legislation also affects highly-paid roles.
The yearly salary exemption may rise to $125,000. This shifts from the current $100,000. The new limit may also adjust for inflation in the future. This keeps the floor updated over time.
Who Is Affected by This Legislation?
The proposal targets these job groups:
- Executive employees
- Administrative employees
- Professional employees
- Highly‑compensated employees
If these workers earn below the new minimum, then overtime rules will apply. Employers must pay extra hours worked over 40 per week.
If you have any questions about the legislation or any other overtime questions, contact us today.
