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When the ball drops, are your exempt employees still exempt?
By T. Christopher Bailey on December 30, 2019 at 4:30 PM

Moving from 2019 to 2020With the new year fast approaching, millions around the world will be gathering to count down the end of 2019 and usher in a new decade. As the ball drops in Times Square, employers should be asking themselves, “Are my exempt employees still subject to the Fair Labor Standards Act (FLSA) exemption?”

Effective Jan. 1, 2020, the standard weekly salary threshold for exempt employees will increase from $455 to $684, or from $23,660 annually to $35,568. Employees earning less than $684 per week must be paid overtime for hours worked in excess of 40 each week. Employees above this salary level who meet the job duties qualifications are exempt from overtime.

For highly compensated employees, the new FLSA rules increase the salary threshold to $107,432 from $100,000. Employers may use nondiscretionary bonuses and incentive payments, including commissions, to satisfy up to 10 percent of the standard salary level.

While the salary thresholds have increased, the duties tests in effect before 2020 remain unchanged.

In anticipation of the 2020 implementation date, employers should review and evaluate the status of their current employees and identify any positions that should be updated. If you have questions about the overtime rule, the classification of your employees or other FLSA compliance issues, the attorneys in our Employment & Labor Practice Group can help you navigate these changes.

Tags: FLSA, Overtime
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