May 17, 2016 | by admin
Labor Department May Announce New Overtime Rule on May 18

When I wrote, The U.S. Department of Labor Is About To Commit “White Collar” Crime, one question was, when the final rule would be announced.  I thought it could be as early as May 18 because, that would be enough time for the president to force the Congress to deal with it in the current legislative session.  By law, the Congress has 60 days to act to reject the new rule.

Shortly before the article was published, the DOL Solicitor predicted a July announcement.

On May 19, the House of Representatives has only 60 “legislative days” scheduled in this session. Had the DOL waited until July, Republicans in Congress might have been able to run out the clock on the new rule and push it in to the next legislative session and, presumably, to a new president who would kill it.

Knowledgeable sources today predicted that the new rule would be announced on Wednesday, May 18. If they are right, look for this to be an issue during the presidential campaign. Proponents will argue that this is giant step forward toward fair pay and income equality.  Opponents will be up against having to explain a complicated rule change that sounds good, but will do more harm than good to the people it is purported to help; a tough case to make in a campaign sound bite.

If the new rule goes into effect, employers will have 60 days to comply.


New Salary Level May Be Slightly Less Than Proposed, But Not By Much

Because of the magnitude of the proposed overtime rule change, and the reaction to it, there has been a lot of speculation about the final amount. It is rumored that the final rule amount will be reduced to $47,000 from the proposed $50,440; a small consolation.  It could be that the 40th percentile of average salary is less than $50,440 or the DOL bowed to the 300,000 mostly negative comments in opposition to the new level.


Can You Still Pay A Salary Less Than The New Minimum?

This is a frequently asked question. The short answer is yes. There is nothing in the FLSA or the new rule that prohibits an employer from paying a salary of any amount, as long as the salary is 1. at least the federal, or higher state, minimum wage, and 2. all overtime hours must be paid at the premium rate of 1.5 times the base hourly rate equivalent.


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