DOL's proposed rule will create more overtime eligible employees

The Department of Labor (DOL) recently published a proposed rule that would raise the minimum salary amount for white collar exempt employees. The DOL's proposal would effectively disqualify millions of workers from being overtime exempt beginning Jan 1, 2016. This could result in more litigation for employers if employees are not classified properly. The DOL's proposed rule substantially increases the salary level of the white collar exemptions to the 40th percentile of all salaried employees' earnings, or, currently $921 per week. To be an exempt administrative, executive, or professional employee, current DOL regulations require employers to pay such employees at least $455 each work week. In light of the DOL's proposed rule, which is targeted to take effect beginning Jan 1, 2016, after a public notice and comment period, employers should consider looking at the way they structure the compensation of their salaried exempt employees.