Require automatic future increases to the threshold. var temp_style = document.createElement('style'); The Overtime Rule. FLSA requirements relating to minimum wage, overtime, and . Specifically, the proposed rule would do the following: The department is responsible for ensuring that employers do not misclassify FLSA-covered workers as independent contractors and deprive them of their legal wage and hour protections. .paragraph--type--html-table .ts-cell-content {max-width: 100%;} OIRA is the White House office responsible for reviewing regulations and proposed regulations before they are publicly released and generally takes 30-90 days for this review, indicating ICE is on target to issue their proposal in July. Lee Schreter, an attorney with Littler in Atlanta, said she wouldn't be surprised if the DOL tightens up the administrative exemption. CUPA-HR participated in all of the calls, expressing our concerns with the timing of the rulemaking as it relates to the ongoing challenges of the COVID-19 pandemic, a historically tight labor market, and increasing inflation. Additionally, CUPA-HR submitted commentsin response to the RPI based on a recent survey detailing members experiences with the Form I-9 verification process flexibilities. Generally, the rule applies to any salaried worker who does not supervise other workers and makes less than $684 a week . We help organizations develop a comprehensive understanding of state laws and regulations to inform investment across people strategies and operations. An official website of the United States government. var currentLocation = getCookie("SHRM_Core_CurrentUser_LocationID"); Read on for everything you need to know. Regardless of the ultimate increase in the salary level, employers who rely on the white-collar exemptions should be on notice of potential changes. .paragraph--type--html-table .ts-cell-content {max-width: 100%;} #views-exposed-form-manual-cloud-search-manual-cloud-search-results .form-actions{display:block;flex:1;} #tfa-entry-form .form-actions {justify-content:flex-start;} #node-agency-pages-layout-builder-form .form-actions {display:block;} #tfa-entry-form input {height:55px;} The amount for small employers will increase again on Jan. 1, 2023 to $15 per hour. EEOC Seeks Comments on Strategic Enforcement Plan The Equal Employment Opportunity Commission (EEOC) has published for public comment, a draft Strategic Enforcement Plan. According to the FTC, this new rule could increase wages by nearly $300 billion annually and expand career opportunities for about 30 million Americans. Restore the multifactor, totality-of-the-circumstances analysis to determine whether a worker is an employee or an independent contractor under the FLSA. The DOL review and anticipated announcement represent a quick turnaround, given the previous update to overtime rules implemented in 2019 delivered the first substantive changes enacted since 2004. The current Final Rule on Overtime has been in effect since Jan. 1, 2020, and, at the time of its implementation, made 1.3 million American workers newly eligible for overtime. Federal law currently requires overtime pay only for employees who earn an annual salary of less than $35,568, although many such workers are excluded. The proposed rule, which would rescind and replace a prior rule published in January 2021, would shift the analysis of whether a worker is an employee of a business for purposes . [CDATA[/* > -1) { The proposed rule is intended to replace the 2021 independent contractor regulation. ACTION: Notice of proposed rulemaking; request for comments. On February 22, 2023, the final farm labor overtime regulations were adopted, codifying Commissioner Reardon's order adopting the recommendation of the Farm Laborers Wage Board to lower the current 60-hour threshold for overtime pay to 40 hours per week by January 1, 2032, allowing 10 years to phase in the new threshold. The DOL plans to make the changes effective in 2023. In its recent spring regulatory agenda, the U.S. Department of Labor (DOL) announced its plans to issue a proposed overtime rule in October 2022. } The most recent regulatory agenda set the date at May 2023. . var currentLocation = getCookie("SHRM_Core_CurrentUser_LocationID"); Please confirm that you want to proceed with deleting bookmark. Despite relying on the labor of millions of workers to provide their services, platform companies have established a business model on the premise that they employ no one. } A final rule on improving tracking of workplace injuries and illnesses is slated for December, as well. Assist with the proper classification of employees and independent contractors under the FLSA. This material was created to provide accurate and reliable information on the subjects covered but should not be regarded as a complete analysis of these subjects. Congress must also have keen insight of the administration's regulatory plans to assess its budget requests and operations. Trumps DOL then revisited the threshold, agreeing that an increase was needed, but one far below the rate Democrats had planned. Get the free daily newsletter read by industry experts. Modify the duties tests so more employees are classified as non-exempt, and. The Biden administration has signaled its desire to return to the approach attempted in 2016. In 2016, the Labor Department under President Obama had proposed a salary basis threshold of $47,476/year, which was invalidated by a District Court and the lawsuit was withdrawn by the Trump Administration. That final rule took effect on January 1, 2020. Misclassification is a serious issue that denies workers rights and protections under federal labor standards, promotes wage theft, allows certain employers to gain an unfair advantage over law-abiding businesses, and hurts the economy at-large. The salary basis threshold has been raised numerous times since Congress enacted the FLSA in 1938. Employers should prepare now to review their workforce for exempt/non-exempt status to ensure they are compliant with the new overtime rule before the effective date is launched. Final Regulatory Text. Please understand that your communications with Locke Lord LLP through this website do not constitute or create an attorney-client relationship with Locke Lord LLP. "Some commentators, though, believe that the administration may go the distance this time and look toward conforming the federal rules to more closely reflect the California standards," he said. .table thead th {background-color:#f1f1f1;color:#222;} Overtime Proposed Rule Release Planned in May, ISO/TC 260 HR Management and HRCI Global Standards Leadership, HRCI Certification for Military HR Personnel. Use of the service is subject to our terms and conditions. The United States Department of Labor (DOL) is expected to propose a new salary threshold for various overtime exemptions under the Fair Labor Standards Act (FLSA). Feel free to contact us if you have questions about this matter. How much of a salary increase the DOL will propose and if it will seek to index the threshold to some cost of living measure remains unknown at this time. More than 100 business and industry groups are urging the U.S. Department of Labor to seek public input before it releases a highly anticipated rule to update overtime pay regulations that is expected to extend time-and-a-half wages to more workers. It remains to be seen whether the DOL will follow its own timeline, however. .manual-search-block #edit-actions--2 {order:2;} The two areas of anticipated revision are to the salary level and duties tests for an employee to be exempt from overtime pay. In . All rights reserved. Please purchase a SHRM membership before saving bookmarks. Thank you again for providing me the opportunity to testify on the Department of Labor final overtime rule, and I would be happy to answer any questions that any of the members may have. The DOL, HHS, and Treasury just released an FAQ that provides guidance on if Drug Manufacturers' Coupons disqualify Health Savings Accounts. The two areas of anticipated revision are to the salary level and duties tests for an employee to be exempt from overtime pay. Topics covered: Employee learning, training, onboarding, mentoring, career development and more. $("span.current-site").html("SHRM MENA "); Washington, DC 202101-866-4-US-WAGE1-866-487-9243, Administrator Interpretations, Opinion and Ruling Letters, Resources for State and Local Governments. Before publication of todays proposed rulemaking, the departments Wage and Hour Division considered feedback shared by stakeholders in forums during the summer of 2022 and will now solicit comments on the proposed rule from interested parties. However, Section 13(a)(1) of the FLSA provides an exemption from overtime pay for individuals employed as bona fide executive, administrative, and professional employees and who receive pay on a salary basis of not less than $684/week. While details of the 2022 proposed changes are forthcoming, organizations should prepare now to address pending challenges and associated opportunities. /*-->*/. The U.S. Department of Labor (DOL) recently announced its intent to update the salary level threshold for "white-collar" exemptions to parts of the Fair Labor Standards Act, a regulatory change that could significantly affect community colleges. The US Department of Labor (DOL) now intends to propose new Fair Labor Standards Act (FLSA) overtime rules this October, six months later than originally planned. DOL Plans Release of Overtime Rule in May In the most recent semi-annual regulatory agenda, the U.S. Department of Labor (DOL) announced that it plans to release in May the proposed salary basis threshold for overtime exemptions under the Fair Labor Standards Act (FLSA) for administrative, executive, and professional employees. Many unions and other worker advocates believe the DOL should match or exceed the $921 salary level of the 2016 proposed rule, with several groups demanding the salary level be set at $1,000 per week. However, court challenges prevented the rule from taking effect and it was permanentlyenjoinedin September 2017. Ms. Moncrief requested an accommodation that would allow her to work remotely two days per week and be allowed frequent breaks while working on-site due to her pulmonary condition, which placed her at greater risk of contracting COVID-19. March 21, 2022. Please log in as a SHRM member. While it is unclear whether the December NPRM will include the blacklisting language again, the abstract of the re-proposal states that the new proposed rule would be responsive to the comments received on our February 2022 proposal.. The Biden Administration's fall 2021 regulatory agenda projects that the Department of Labor (DOL) will revisit before April 2022 the salary level at which an employee could be exempted from federal overtime and minimum wage requirements, as well as address other aspects of the overtime regulatory regime. The DOL's new overtime rule is expected to raise the minimum salary for most overtime-exempt employees and . Author: Michael Cardman, XpertHR Senior Legal Editor. CUPA-HR filedcommentsin opposition to the Trump administrations regulations on the issue andin responseto the Biden administrations RFI. Those changes, however, were less significant than the 2016 efforts to modify FLSA provisions, which were halted later due to a preliminary injunction. The proposed changes will impact Employers and employees. }. .manual-search ul.usa-list li {max-width:100%;} We anticipate the proposed new level will be higher. As we previously reported in our New Year's Update for 2022, the US Department of Labor (DOL's) regulatory agenda included proposed rulemaking on the Fair Labor Standards Act (FLSA) overtime rules by April 2022. Sign up for our newsletter and get the latest to your inbox. Gallagher supports organizations with comprehensive solutions to include exemption review, compensation and classification structures, enhanced management of ongoing joint-employer challenges and implementation strategies. .usa-footer .grid-container {padding-left: 30px!important;} The U.S. Department of Labor (DOL) had predicted it would issue its proposed new rule to overhaul the overtime regulations of the Fair Labor Standards Act in October, but we are still waiting for that proposal. Last October, the DOL proposed a new independent contractor rule that would establish a version of the "economic realities test" as the standard for determining whether a worker is an employee or an independent contractor under the FLSA. The courts blocked this proposal shortly before it was scheduled for implementation. Need help with a specific HR issue like coronavirus or FLSA? An agency within the U.S. Department of Labor, 200 Constitution Ave NW Your session has expired. The salary basis threshold was increased in 2019 from $23,660/year to $35,568/year. Effective Jan. 1, 2022, the minimum wage in California will increase to $15 per hour for large employers with 26 or more employees; it will increase to $14 for small employers with fewer than 25 employees. Learn how SHRM Certification can accelerate your career growth by earning a SHRM-CP or SHRM-SCP. President Joe Biden directed the DHS on Jan. 20, 2021, to take all appropriate actions to preserve and strengthen DACA, consistent with applicable law. June 29, 2022. In 2016, a proposed change would have moved the salary threshold from $455 per week ($23,660 annualized) to $913 per week ($47,476). The FTC stated that the proposed rule would apply to employees, independent contractors, and volunteers. The proposed rule would provide guidance on classifying workers and seeks to combat employee misclassification. In September 2019, the Trump DOL issued a new overtime rule, which took effect on January 1, 2020, raising the weekly minimum salary for EAP exemptions from $455 per week ($23,660 per year . Topics covered: HR management, compensation & benefits, development, HR tech, recruiting and much more. In closing AMB applauds the substantial effort of the Department of Labor in overhauling these regulations. The DOL has considered modifying the regulations in this regard a few times in recent yearsbut hasended up leaving the current tests alone. On July 16, 2021, the U.S. District Court for the Southern District of Texas vacated the June 2012 memorandum that created the DACA policy and permanently blocked the DHS from administering the DACA program and from reimplementing DACA without compliance with the Administrative Procedure Act. DOL's Wage and Hour Division plans to develop and release a notice of proposed rulemaking . The deadline to announce such changes was initially set for April 2022 but has since seen several delays. . Currently, the Department of Labor requires that employees covered by the Fair Labor Standards Act must receive overtime pay for working more than 40 hours in a workweek, unless the employee is covered by certain exemptions. Of our website and to give you a better experience and the ability to organize into unions specific HR like! 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