Department of Labor Raises Overtime Threshold for Exempt Employees

Lilly Hummel

The Department of Labor (DOL) finalized its proposed rule to increase the salary threshold under which “white collar” exempt staff would be guaranteed time-and-a-half pay when they work more than 40 hours in a given week. Effective January 1, 2020, the threshold will rise to $684 per week or $35,568 per year for a full-year worker. The current threshold, which has been in place since 2004, is $455 per week or $23,660 per year. Providers should review their exempt salaried staff to identify those who could become newly eligible for overtime.

By way of background, in 2016, the Obama administration finalized a rule that would have doubled this threshold. That rule faced subsequent litigation, during which a judge issued a preliminary injunction and the Trump administration ultimately declined to argue in support of the new threshold. The Trump administration issued a Request For Information to hear from stakeholders before publishing its own threshold.