Commentary: The U.S. Department of Labor released a highly anticipated proposed new rule that will significantly broaden federal overtime protection for employees. Secretary of Labor Thomas Perez has said, “the proposed overtime rule goes to the heart of what it means to be middle class in America.” Indeed, by the DOL’s own calculations, roughly 25% of all exempt employees in the country will be rendered nonexempt and eligible for overtime pay under the proposed rule.
What will the proposed rule mean for your organization? For one, it will make it more difficult to classify employees as exempt, which means employers will have to pay more overtime. And even for jobs that remain properly classified as exempt, employers may have to pay a higher weekly salary to meet exemption requirements. Employers must start planning for these changes now.
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