Department of Labor Releases Final Regulations Governing Overtime Exemptions Under Fair Labor Standards Act

On May 18, the Department of Labor released its final regulations governing overtime exemptions under the Fair Labor Standards Act.

The Final Rule focuses primarily on updating the salary and compensation levels needed for Executive, Administrative and Professional workers to be exempt.  Specifically, the final rule:

  1. Sets the standard salary level at the 40th percentile of earnings of full-time salaried workers in the lowest-wage Census Region, currently the South ($913 per week; $47,476 annually for a full-year worker);
  2. Sets the total annual compensation requirement for highly compensated employees subject to a minimal duties test to the annual equivalent of the 90th percentile of full-time salaried workers nationally ($134,004); and
  3. Establishes a mechanism for automatically updating the salary and compensation levels every three years to maintain the levels at the above percentiles and to ensure that they continue to provide useful and effective tests for exemption.

The effective date for the final rule is December 1, 2016.

There are many different perspectives to how this rule may impact the Employment Practices Liability arena germane to many PLUS Members.  To help sort it out, we have asked that member law forms provide information that we can share with our members regarding the final rule.  Below are the resources we’ve gathered (if you’d like to submit information for this page, please email

From the PLUS webinar on this issue, Noel Tripp of Jackson Lewis reviews four strategies for employers to deal with the changes:

Lindsey S. Mignano, a partner with Smith Shapourian Mignano LLP, discusses the rule and exemptions.

David Walston, a partner with Christian & Small, explains the new rule in his article U.S. Department of Labor Releases New Overtime Regulations – Key Provisions Explained.

In his article Will New DOL Overtime Rules Result in a Spike in Collective Actions? Robert Chadwick, a Managing Member with the firm Stamer Chadwick Soefje, PLLC, discusses how the financial stakes in a collective action under the Fair Labor Standards Act (FLSA) may skyrocket when the new overtime rules take effect.

The United States Department of Labor has created a series of webinars which will provide general information on the rule as well as provide information for both the non-profit sector and state and local governments.

Below is a list of PLUS corporate member law firms who have authored articles on this topic:

Bailey Cavalieri

Carlton Fields

Carr Allison

Clark Hill

Cooper Levenson

Freeman Mathis & Gary

Hedrick Gardner Kincheloe & Garafalo

Kaufman Dolowich Voluck

Marshall Dennehey Warner Coleman & Goggin

Meagher & Geer

Melick & Porter

Taylor English Duma

Troutman Sanders

Wilson Elser

Zarwin, Baum, DeVito, Kaplan, Schaer, Toddy, P.C.


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Wage and Hour – Change is Coming

In this clip from “Wage & Hour: The EPL Hot Topic?” at the 2014 PLUS Professional Risk Symposium, Andrew S. Naylor, Esq. of Waller Lansden Dortch & Davis, LLP discusses FLSA cases and pending changes to the employee exemptions regulations. Watch the video to see what prompted him to say…

“We’re going to see a fundamental change in how the wage and hour laws work”

To see how this topic continues to evolve don’t miss the 2014 PLUS Conference, November 5-7 in Las Vegas. Our panels and speakers will delve into wage and hour once again, plus an entire session dedicated to the professional liability risks of legalized marijuana! Don’t miss it – register now before rates go up on July 12.

PLUS members can view this entire session in the PLUS Multimedia Library.


Workplace Issues in the Aftermath of Sandy

A guest blog post by Robert Chadwick of Campbell Chadwick:

Hurricane Sandy has already had a significant impact upon American workplaces.  Employees have been mobilized either by their employers or federal or state uniformed services to participate in relief efforts.  Family members of victims are employed throughout the United States. Employers must be mindful of the legal challenges posed by these unique circumstances lest they become another victim of Sandy.

Volunteers:  The Fair Labor Standards Act (“FLSA”) allows persons to volunteer or donate humanitarian services, without compensation, to public agencies and religious, charitable and other non-profit organizations. Entitlement to wages, including minimum and overtime pay, however, becomes an issue when for-profit private sector employers either use their own employees to engage in humanitarian efforts directly or require their employees to provide services to non-profit organizations.

Family and Medical Leave:  The Family and Medical Leave Act (“FMLA”) specifies the conditions under which leave must be provided to an employee (1) to care for a spouse, son, daughter or parent with a serious physical or mental health condition, (2) because of any qualifying exigency arising out of the fact that the employee’s spouse, son, daughter, or parent is a covered military member on active duty (or has been notified of an impending call or order to active duty) in support of a contingency operation, or (3) because of a serious mental health condition that makes the employee unable to perform his or her job.  The FMLA covers employers with 50 or more employees and prescribes leave of up to 12 weeks.  Many states have similar laws which apply to smaller employers and which provide broader leave rights.

Bereavement Leave:  Although neither the FMLA nor federal law directly addresses bereavement leave, an employee may nevertheless be entitled to such leave under state law, a collective bargaining agreement or a legally binding personnel policy.  Some state laws also provide for leave from work for bereavement for an immediate family member who is a crime victim.

Military Leave:   The Uniformed Services Employment and Reemployment Rights Act (‘USERRA”) requires all employers to provide certain leave and reemployment rights and benefits to employees who serve in the uniformed services.  That an employee volunteered for military service does not affect entitlement to such rights and benefits.  State law also safeguards employees who perform state military service.

Mental Disabilities:  The Americans With Disabilities Act (“ADA”) mandates that the mental disabilities of qualified individuals be reasonably accommodated by private employers.  Enforcement guidance provided by the Equal Employment Opportunity Commission (“EEOC”) defines a mental impairment as including major depression and such anxiety disorders as post-traumatic stress disorder.  A mental impairment which substantially limits such major life activities as learning, thinking, concentrating, interacting with others, caring for oneself, speaking, performing manual tasks, or working can be a protected disability under the ADA.  The ADA applies to employers with 15 or more employees. Many states have similar laws protecting discrimination against disabled employees.