Overtime Exemption and Sustainable Jobs? - Part I -

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Exempt_ERD_HRComatrix©
I am back after a long summer hiatus with Breaking News today: The DOL has finally issued a final rule on overtime exemption, raising the minimum salary exemption level to $684 a week or $35,568 a year. This takes effect January 1st of 2020, a new year gift to employees and employers alike.

For the story, let's look back at my previous post on the subject of minimum wage, and at what other countries have in store. Where do we stand on the global scale with so called developed countries? However, first things first: what overtime exemption entails?

Defining Exemption


Overtime rules refer us to the  Fair Labor Standards Act (FLSA). Basically, for any hours worked over 40 hours during the week, an employee paid under $684 a week will be entitled to overtime pay, that is 1.5 times his/her hourly wage. The new rule is expected to impact 1.3 million workers.

As a refresher and as a rule of thumb three tests are required to meet the exemption definition:
  1. The salary basis test: the worker must be salaried (not impacted by the number/length of days worked)
  2. The salary level test:  A minimum salary must be met (raised from $455/week to $684/week or $35,568 a month on 01/01/20)
  3. The job duty test: Job duties need to be primarily executive, administrative, or professional (EAP)
 All three tests are to be met.  Bonuses may be counted up to 10% towards the salary requirement. Highly Compensated Employees (HCE) will also see a change in compensation level requirement.

Some related background notes here. 

Et voilà! La décision de la rentrée de Septembre, fraîche de ce jour: le salaire minimum du personnel d'encadrement est fixé a $35 568/an à partir du 1er Janvier 2020, soit à 32 342 Euros, bonus inclus à raison de 10% max... Des étrennes!
Mais si vous voulez en savoir plus sur le mode de rémunération aux USA, visitez des notes préliminaires ici pour la petite histoire!
***** 
(What steps to take then? To be continued)

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