July 2022 Newsletter

The U.S. Department of Labor (DOL) announced that its proposed overtime rule is now tentatively slated to be released in October.

Once anticipated in the spring, the proposed rule will recommend how to implement the exemption of bona fide executive, administrative and professional employees from the Fair Labor Standards Act’s (FLSA’s) minimum wage and overtime requirements.

High on the DOL’s list of priorities with the proposed overtime rule will be adjusting the salary level, possibly increasing it from its current annualized rate of $35,568. There’s been pressure to bring the amount to as high as the $47,476 annualized amount that was enjoined by a court in 2016, but many advocates are seeking even higher levels, from $62,000 to over $80,000 per year.

Another item on the list of DOL priorities may be the creation of an automatic annual or periodic increase to the salary level by indexing it to the consumer price index or another economic indicator so that the amount will increase without the DOL having to undertake formal rulemaking.

One other item that may be in play is the duties test. The DOL has considered modifying the regulations in this regard a few times in recent years but has ended up leaving the current tests alone.

While employers should be monitoring these potential changes, the regulatory process is still in the early stages. At this time, stakeholders do not even know what changes the DOL will propose, much less finalize. Thus, it is premature to make internal changes to pay policies in anticipation of the rulemaking. Many in the business community believe that current hiring and retention issues, supply chain disruptions, and inflationary pressures are all reasons why the DOL should not proceed with a rulemaking.

Other DOL Action

The DOL noted in its agenda that the Occupational Safety and Health Administration (OSHA) has already issued an emergency temporary standard to address the danger of COVID-19 in health care workplaces. The department said in the regulatory agenda that “the danger faced by health care workers continues to be of the highest concern and measures to prevent the spread of COVID-19 are still needed to protect them.” OSHA aims to complete a final rule by September.

A final rule on improving tracking of workplace injuries and illnesses is slated for December, as well.