Overtime exemption thresholds may change

| Mar 16, 2016 | Wage And Hour Laws |

By the end of 2016, California workers might have greater protection from working overtime without getting properly compensated for it based on a proposal from the U.S. Department of Labor. When published in the Federal Register in 2015, the proposal received so many comments that the implementation may be delayed until late in 2016.

Employees who are classified as non-exempt are entitled to be paid time-and-a-half if their work week exceeds 40 hours. For employees who qualify for overtime pay, the threshold for the annual salary will go up from $23,660 annually to $50,440 based on 2016 data. There will also be an increase in the threshold for exemption qualification for highly compensated employees from $100,000 to $122,148 based on 2013 data.

The threshold for employees who are exempt from overtime will go up over time following the initial increase although it has not yet been determined how subsequent increases will be calculated. These revised thresholds would be published annually with at least 60 days’ notice. The idea behind the proposal is to prevent employees who would otherwise be considered non-exempt being reclassified on the basis of their pay.

In some cases, employees may feel that they are being taken advantage of because they are entitled to overtime pay, but they may not know what their rights are. For example, a company might ask its hourly workers to stay late one hour each workday without offering any compensation. Employees may face retaliation for questioning these practices or for refusing to work extra without pay. That retaliation might include termination, which an employment law attorney will recognize as likely being unlawful.


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