WASHINGTON, DC — More discussions about rulings over the minimum salary have taken place leading to the Department of Labor (DOL) to maintain its appeal of an injunctive order initiated by the DOL under the Obama Administration after a federal judge in Texas enjoined a rule that increased the minimum salary for an employee to be classified as exempt from $26,661 to $47,476.
What Are Employees Entitled To Under FLSA And The Final Rule?
While the Final Rule will be changing which workers will be eligible to receive overtime benefits, the benefits themselves will remain unchanged. The primary overtime benefit is the payment of at least “time-and-a-half,” or 1.5 times standard pay rate, for each hour an employee works beyond 40 hours. This policy applies to salaried workers whose earnings fall below the overtime salary threshold – which has been raised with the passing of the Final Rule.
Since the change in administration, the DOL has undergone a major housecleaning that has left many of the officers from the previous administration out of jobs. The DOL under the Trump administration has become extremely pro-employer, as opposed to their pro-employee position under the past administration. Despite the ideological shift, in a recent reply brief, the DOL has maintained the injunctive order issued by the Texas Judge Amos L. Mazzant was flawed.
Does The Current Salary Threshold For The Final Rule Include Other Compensation?
While the Final Rule gives employees a great deal of power to pursue overtime pay benefits, it does include a provision that grant employers some flexibility. This flexibility comes in the form of an employer being able to use non-discretionary bonuses, incentive pay, and commissions to meet the EAP salary threshold. Non-discretionary bonuses differ from discretionary bonuses as they are promised to an employee to incentive them to work more efficiently or stay with the company.
However, there a several stipulations that restrict just how much flexibility is offered to employers. These stipulations are as follows:
- Payments must be made on – at minimum – a quarterly basis
- Payments may not exceed more than 10% of the required salary threshold
In the event that an employee fails to earn sufficient enough bonuses or commissions, they must receive a “true-up” payment immediately after the quarter ends to align their compensation with the salary threshold. If an employer fails to issue this payment to their employee, that employee would be eligible to pursue overtime benefits as laid out by the Final Rule.
Although the current DOL will not back the revised Overtime rule as proposed by the past administration, they do recognize that the injunctive order was meant as a check and balance saying that the DOL does not have the authority to set any minimum salary for exemption status to the FLSA overtime requirements. That is a tricky situation because this would mean the DOL would lose authority that they’ve had dating back to 1940. This is a slippery slope, and if the injunctive order were to stand, it would completely change the FLSA exemption.
FLSA Overtime Lawsuits
Call (855) 754-2795 or complete the Free Unpaid Overtime Case Review form on the top right of this page if you believe that your wage rights are being violated under the FLSA. Our top-rated team of unpaid wage lawyers will evaluate your situation to determine your best course of action to help you seek justice.
Our office will also determine if it is in your best interest to file a lawsuit against your employer. Because strict time limitations apply for filing these types of claims, we advise you contact our experienced unpaid overtime wage attorneys at your earliest convenience and preserve your legal rights.