The Department of Labor has announced a final rule that it sayswill make 1.3 million workers eligible for overtime pay under theFair Labor Standards Act (FLSA).

The rule, according to the DOL, updates overtime regulationswith new earnings thresholds "necessary to exempt executive,administrative, or professional employees from the FLSA's minimumwage and overtime pay requirements, and allows employers to count aportion of certain bonuses (and commissions) towards meeting thesalary level."

"Today's rule is a thoughtful product informed by publiccomment, listening sessions, and long-standing calculations," saidWage and Hour Division administrator Cheryl Stanton. "The Wage andHour Division now turns to help employers comply and ensure thatworkers will be receiving their overtime pay."

The rule does boost salary levels from where they were in thecurrently enforced 2004 rule, but falls far short of a final rulepassed during the Obama administration that would have taken effecton December 1, 2016 but was blocked in court from being implemented. Thatrule would have raised the threshold from its 2004 level of $23,660to $47,476. The Trump administration's version affects far fewerpeople and raises the pay level far less.

Under the new rule, the "standard salary level" has been raisedfrom the currently enforced level of $455 per week to $684 per week(equivalent to $35,568 per year for a full-year worker). It alsoincreases the total annual compensation level for "highlycompensated employees" from the currently enforced level of$100,000 to $107,432 per year.

In addition, it allows employers to use nondiscretionary bonusesand incentive payments, including commissions, that are paid atleast annually to satisfy up to 10 percent of the standard salarylevel, in recognition of evolving pay practices. It also revisesthe special salary levels for workers in U.S. territories and inthe motion picture industry.

States that have not been happy with the pre-emption of theObama administration rule have taken action on their own to expandthe number of workers eligible for overtime pay.

The new rule will take effect on January 1, 2020.

From: BenefitsPro