The threshold for white-collar employees to be classifiable as “exempt” will rise about 50% to $684 per week (about $35,568 per year) on January 1, 2020. Employers will need to make adjustments to ensure they’re compliant with this updated rule, under the Fair Labor Standards Act, announced on September 24 by the U.S. Department of Labor. By “exempt” I am referring to employees who do not qualify for overtime pay.
The rule change—which boosts the threshold from $455 per week and $23,600 per year, as previously set in 2004—will affect about 1.3 million workers, the DOL says, who could be reclassified as “non-exempt,” and thus eligible for overtime pay. Under the new rule, employers will be able to fill up to 10% of the $684 per week with non-discretionary bonuses, incentives and commissio