| As we recently reported to you, effective January 1, 2020, the minimum guaranteed salary requirement for the “white collar” exemptions from overtime under the Fair Labor Standards Act (FLSA) is being raised from $23,660 to $35,568. Under the “white collar” exemptions from overtime, an employee may be considered exempt from the overtime requirements of the FLSA if he/she falls within any of the three white collar exemptions, i.e., the employee is a bona fide executive, administrative, or professional employee. Please note, an employee is not considered exempt, merely because of a certain title or because he/she is paid a “salary.” Rather, an employee must (1) be paid a guaranteed minimum at the specified threshold ($684 per week under the new rule); AND (2) the employee must also meet the other myriad requirements for the exemption, including the duties tests applicable to each exemption. For those employees who were previously categorized as exempt from overtime under a “white collar” exemption, but who do not meet the new required minimum salary threshold, dealers must either increase the employee’s salary to $684.00 per week or reclassify the employee as nonexempt and begin paying that employee overtime for all hours worked over 40 in a week. The Department of Labor will allow employers to use nondiscretionary bonuses and incentive payments (including commissions) to satisfy up to ten percent of the minimum salary level for the “white collar” exemptions, provided that such payments are paid at least annually. |
| Please feel free to contact a member of our Dealer Practice Group with any questions about this notice, at 248-645-9300 or by email. Chuck LeFevre – [email protected] Lawrence F. Raniszeski – [email protected] Eric R. Bowden – [email protected] Alycia Pallach Wesley – [email protected] Nicholas J. Ranke – [email protected] |
