In July, the Department of Labor (DOL) issued a proposal of changes regarding the way overtime pay should be calculated when applied to “white collar workers.”
White collar workers are typically known as the administrative, executive, and professional employees of a company, and are considered exempt workers when it comes to overtime pay. Typically, an exempt employee is not entitled to overtime pay.
Under the Fair Labor Standards Act (FLSA), exempt employees perform certain job duties, which are described under the Act. They also are paid a weekly salary, as opposed to an hourly rate. Under the current law, which has not been altered since 2004, in order for an employee to be considered exempt, his or her salary must be a minimum of $455 per week or more. This works out to a minimum of $23,660 annually.
The DOL has proposed that the minimum salary be raised to $921 per week ($47,892 per year), with another increase next year to $970 a week ($50,440 annually). The DOL proposal also includes an annual increase of minimum salary requirements.
What the Changes Mean
Any individual who receives a salary of less than $921 per week would now be entitled to receive overtime pay—at a rate of time and one-half—for any hours over 40 that he or she works each week. The Department projects that this increase in minimum salary would affect five million workers who would be entitled to overtime pay pending the proposals are enacted.
Unlike other federal changes, these proposals do not have to be approved by Congress in order for the changes to be adopted into law. The changes are considered regulations under the Act, but do not actually change the law. Therefore, a Congressional vote is not required. However, the DOL is required to offer a two month period where anyone—businesses or individual citizens—can voice his or her support or opposition to the proposals. This period recently ended on September 4.
If your employer owes you wages for hours you have worked, please contact an experienced Chicago employment law attorney who can advise you on your overtime eligibility.