The Department of Labor issued, on September 24, 2019, its final rule revising the salary requirements for exemption from the Fair Labor Standards Act’s mandate to pay overtime for hours worked over 40 in a workweek. The new rule increases the salary required to meet the executive, professional and administrative exemptions to $684 per week (the equivalent of $35,568 per year). The required compensation for highly compensated employees is raised to $107,432.
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NLRB Expands Scope of Mandatory Arbitration Agreements
The National Labor Relations Board has now addressed the use of mandatory arbitration agreements following the U.S. Supreme Court’s 2018 decision in Epic Systems v. Lewis, which upheld the enforceability of arbitration agreements containing waivers of the right to bring class or collective actions over employment-related disputes, rejecting the NLRB’s then-position that such waivers violate the National Labor Relations Act (NLRA), as discussed in our prior E-lert.
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Court Finds DOL’s New Persuader Rule “Flawed”
The U.S. District Court in Minnesota ruled, on June 22, 2016, that the Department of Labor’s new interpretation of the advice exemption from the persuader rule is “untenable” and “flawed.” The Court did not issue an injunction against the new interpretation, which goes into effect July 1, 2016, but that was based on its finding that the DOL suspended the most objectionable reporting requirement after the lawsuit was filed. The challenge to the new interpretation was filed by Worklaw Network, a national alliance of labor and employment firms of which we are a member. Our firm, along with Seaton, Peters & Revnew, P.A. of Minneapolis, represented Worklaw, as we discussed in a prior post, “Shawe Rosenthal and Worklaw Just Sued the DOL.”
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NEW OVERTIME RULE
On May 17, 2016, the Department of Labor announced the release of its long-awaited revisions to its overtime exemption rule. The new rule doubles the salary requirement for white collar (executive, administrative and professional) employees from $23,660 per year ($455 per week) to $47,476 per year ($913 per week). The required minimum salary for the highly compensated employees’ exemption also has been raised from $100,000 to $134,004. These salary levels will be subject to automatic adjustments every three years. The new rule does not change the duties test for any of the exemptions. It will take effect on December 1, 2016. Our firm will be holding a complimentary webinar on Wednesday, May 25 to discuss the changes and offer practical suggestions on how to comply with the new rules.
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Planning for Changes in Overtime Exemptions
Employers should start thinking about how changes in the tests for the federal overtime exemptions will affect their payroll costs and compensation plans. An employee must meet both a salary test (meaning that they are paid a salary, currently at least $455 per week) and a duties test to qualify for the exemptions (except for
New Executive Order = New Burdens for Government Contractors
On July 31, 2014, the President issued an Executive Order entitled, “Fair Pay and Safe Workplaces,” which will make an employer’s record of compliance with federal and state labor laws a criterion for successful bidding on government contracts and subcontracts exceeding $500,000. In a Fact Sheet accompanying the Executive Order, the White House