This latest FLSA “White Collar” exemptions guide focuses on an important provision in the Labor Department’s (DOL) recently revised rules governing overtime eligibility for “white collar” exempt workers that allows employers to apply nondiscretionary bonus payments toward meeting minimum salary threshold requirements.
The FLSA’s white collar exemptions – executive, administrative, and professional – are the three most commonly applied exemptions to the law’s requirement that employers pay employees overtime for any hours worked over 40 in a workweek. The Labor Department’s regulations defining these exemptions have three requirements in order for an employee to be exempt from overtime pay, one of which is the employee must earn a specified minimum salary.
DOL’s recent revisions to the white collar regulations, which went into effect on January 1, 2020, increased the minimum salary threshold for determining whether a “white collar” employee is automatically entitled to overtime pay, to $35,568, or $684 a week. Also included in the revisions is the relatively complicated discretionary bonus provision, which if used properly can be a benefit to employers, especially with respect to employees who are paid below but close to the new salary threshold.
Members of the Center for Workplace Compliance (CWC) can read more here.