Department of Labor Announces Final Rule Making 1.3 Million Eligible for Overtime Pay

The U.S. Department of Labor (DOL) issued a new rule today, September 24, that will make more than a million people newly eligible for overtime pay. The new rule takes effect on January 1, 2020.

According to the DOL, “the new thresholds account for growth in employee earnings since the currently enforced thresholds were set in 2004.”

Moreover, employers are able to count certain bonuses and commissions towards meeting the threshold earning. Notably, the “standard salary level” has been increased from $455 to $684 per week (or $35,568 per year).

The DOL also says it is:

  • Raising the total annual compensation level for “highly compensated employees” from the currently-enforced level of $100,000 to $107,432 per year;
  • Allowing employers to use nondiscretionary bonuses and incentive payments (including commissions) that are paid at least annually to satisfy up to 10 percent of the standard salary level, in recognition of evolving pay practices; and
  • Revising the special salary levels for workers in U.S. territories and in the motion picture industry.

Read the full news release on the Department of Labor’s website.