ASA Survey on 2016 Overtime Rule Impact

The Department of Labor published a Request for Information seeking information from stakeholders on how it should proceed with a new rulemaking to replace the Obama Administration’s regulation on eligibility for overtime pay.

Currently, the overtime rule is blocked from taking effect by a preliminary injunction issued in November . The Trump Administration has filed its final brief in the appeal of that ruling, and has argued that the Secretary of Labor has the legislative authority to issue a salary threshold, but that the salary threshold set by the Obama Administration was inappropriate. The newly issued RFI begins the process for rulemaking to set a new salary threshold.

Responses are due to the Department of Labor by September 25, 2017.  In particular, the Department seeks comment on and information relating to the following questions. We ask that you take a few moments to share with us your opinions on this topic. The full RFI can be viewed here.

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* 1. What methodology should be used for setting the salary threshold, and should the 2004 threshold just be updated for inflation?

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* 2. Should there be changes made to the duties test, and should the salary test be eliminated in favor of a duties-only test for exemption?

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* 3. Should there be multiple salary levels to account for geographic, company size, or some other difference? Should there be a different standard for salary levels for the executive, administrative and professional exemptions as it did prior to 2004? In your opinion, what would the impact be on employers and employees?

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* 4. In anticipation of the 2016 Rule, to what extent did your company increase salaries of exempt employees in order retain their exempt status, decrease newly non-exempt employees’ hours or change their implicit hourly rates so that the total amount paid would remain the same, convert worker pay from salaries to hourly wages, or make changes to workplace policies either to limit employee flexibility to work after normal work hours or to track work performed during those times?

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* 5. Did you make any changes, such as reverting salaries of exempt employees to their prior (pre-rule) levels, after the preliminary injunction was issued?

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* 6. Does the salary level set in the 2016 Final Rule exclude from exemption particular occupations that have traditionally been covered by the exemption and, if so, what are those 12 occupations? Do employees in those occupations perform more than 20 percent or 40 percent non-exempt work per week?

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* 7. The 2016 Rule for the first time permitted non-discretionary bonuses and incentive payments (including commissions) to satisfy up to 10 percent of the standard salary level. Is this an appropriate limit or should the regulations feature a different percentage cap? Is the amount of the standard salary level relevant in determining whether and to what extent such bonus payments should be credited?

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* 8. Should there be multiple total annual compensation levels for the highly compensated employee exemption? If so, how should they be set: by size of employer, census region, census division, state, metropolitan statistical area, or some other method? What would the impact of multiple total annual compensation levels be on particular regions or industries?

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* 9. Should the standard salary level and the highly compensated employee total annual compensation level be automatically updated on a periodic basis to ensure that they remain effective, in combination with their respective duties tests, at identifying exempt employees? If so, what mechanism should be used for the automatic update, should automatic updates be delayed during periods of negative economic growth, and what should the time period be between updates to reflect long term economic conditions?

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* 10. Please use this space below to provide ASA any remaining thoughts you have on this topic. And a reminder, that while ASA will be submitting comments by September, 1,000's of other special interests, including labor unions and those in support of this regulation will also be submitting comments. You are strongly encouraged to submit your own views to DOL. You can click HERE and submit your own comments.

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* 11. I am a:

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