The proliferation of artificial intelligence in the workplace, and the ensuing expected increase in productivity and efficiency, could help usher in the four-day workweek, some experts predict. By virtue of the National Labor Relations Act’s system of five-year staggered appointments to the NLRB, presidents are able to influence the board’s direction during their four-year terms, but they cannot dominate it or dictate the outcome of a particular case that is before the labor board. Department of Labor WHD database, Florida has had 819 child labor violations since 1985. Last year saw eight violations in the state, mostly from fast food joints and restaurants. The law also prohibited 16- and 17-year-olds from working more than eight hours if they have school the next day, unless it’s a Sunday or a holiday. The law requires a 30-minute break every four hours if the minor has a shift longer than eight hours.
According to the DOL’s estimates, this change is expected to cause over 4.2 million currently-exempt white collar workers to become entitled to FLSA overtime rights, absent intervening action by their employers. The proposed rules would increase the salary threshold from $455 a week (or $23,660 per year) to $970 a week (or $50,440 per year) in 2016. The DOL’s proposed minimum exempt salary threshold represents the fortieth percentile of full-time salaried employees’ salaries and would include automatic periodic increases. Additionally, highly compensated employees who, under the current FLSA regulations, are exempt if they receive more than $100,000 per year , and would see the salary threshold rise to $122,148.
First, and at a minimum, employers should continue applying the 2019 salary threshold ($684 per week) when evaluating whether an employee satisfies the white-collar exemptions. Due to these additional costs, businesses reliant on independent contractors are pushing back. On January 11, 2024, the plaintiff business organization filed a motion to revive the previous litigation. Additionally, on January 16, 2024, a group of freelance writers filed a lawsuit in the U.S.
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Certain executive, administrative, and professional workers (“white-collar workers” or “EAP workers”) are “exempt” from overtime if their job responsibilities satisfy the “duties test” and they earn more than $23,660 per year or $455 per week. Without question, if an employee received an increase in July 2024 and was told about another required regulatory raise in 2025, lowering their pay now will create morale issues. Importantly, the DOL is not proposing changes to the standard duties test, emphasizing the importance of an appropriate salary level requirement to distinguish bona fide EAP employees from nonexempt workers. This is good news for employers who have relied upon the standard duties test in categorizing their exempt and non-exempt employees.
DOL proposes increase to exempt salary level threshold
The 2016 rule also included a provision automatically raising these salary thresholds every three years. But a federal district court in Texas enjoined and then invalidated this 2016 rule, finding the DOL exceeded its authority. Specifically, the court found that the language of the 2016 rule and the substantial increase in the salary thresholds effectively eliminated the other requirements of the FLSA, which the DOL was not authorized to do.
- The rule represents yet another regulatory update for employers, following DOL’s independent contractor final rule and the U.S.
- The proposed rule received over 33,000 comments, receiving harsh criticism from the business community.
- After the comment period closes, the DOL has to decide whether to move forward with a final rule.
- Additionally, the suggested rule also proposes an increase in the salary threshold for the exemption of highly compensated employees from $107,432 to $143,988 per year.
Moreover, the proposed rule would increase the proposed changes to the fair labor standards act special minimum weekly base rate applicable to EAP employees in the motion picture producing industry from $1,043 per week to $1,617 per week. This special rate was established to relax the salary basis test in consideration of this industry’s “peculiar employment conditions” that often result in employees working less than a full workweek. For these employees, DOL’s rule will increase the minimum salary threshold to $132,964 on July 1, and to $151,164 on Jan. 1, 2025, Patrick Oakford, deputy assistant secretary for policy at DOL, said during the press call. The FLSA does, however, exempt certain categories of “white collar” workers—including certain executive, administrative, and professional employees—from its minimum wage and overtime requirements.
This methodology is based on the 20th percentile of weekly earnings of full-time salaried workers in the lowest-wage U.S. Census region, while the January 2025 increase uses an updated methodology that is based on the 35th percentile. “Overtime”, as defined by the FLSA, requires employers to pay employees covered by the act at a rate not less than one and one-half times their regular rate of pay for hours worked in excess of 40 in a workweek, unless specifically exempted. While employers will certainly want to follow this issue closely, now is the time to review your compensation packages. Should these changes become effective, to maintain exempt status, employers may either raise their salaries or reclassify employees as non-exempt and pay overtime.
What are the current child labor laws in Florida?
In public comments submitted to the DOL on Nov. 7, 2023, SHRM said it supports regular and reasonable increases to the overtime salary threshold but opposes automatic increases. This ruling is a welcome respite for employers who continue roiling from increased labor costs following a period of high inflation, but the timing is unfortunate because employers have already devoted countless hours to begin preparing for the final rule’s implementation. DOL estimated that these changes would result in employers reclassifying millions of employees as nonexempt, requiring employers to either pay overtime or adjust work schedules to avoid increased costs. This webinar provides a general overview of requirements under section 13(a)(1) of the FLSA, and will discuss the final rule’s revisions, including scheduled increases to certain earnings thresholds required for exemption. The debate over SB 918 underscores the delicate balance between economic opportunity and worker protections.
Employers should ensure their classification practices align with both duties and salary tests under existing FLSA standards. In an unfair labor practice complaint against Apple, the National Labor Relations Board accused it of trying to prevent employees from discussing pay equity. Joe Biden was the first president to join a union picket line and support labor’s side in a number of major disputes. His appointments to the National Labor Relations Board, the principal administrative agency handling labor-management conflict, interpreted the 90-year old National Labor Relations Act so as to enhance the rights of workers to organize. The Biden board promoted workplace democracy more effectively than any of its predecessors. Is it possible to balance between parental rights, economic opportunity and the potential risks to young workers’ well-being?
- Census region, while the January 2025 increase uses an updated methodology that is based on the 35th percentile.
- On January 10, 2024, the DOL published its final rule regarding the test for determining whether workers are independent contractors or employees under the FLSA.
- This year is no different, with the proposed FLSA changes sending ripples of uncertainty about their potential impact through the business community.
- Dynamic distributional analysis considers how a policy affects households across the income and age distribution, including the unborn (represented by a negative age index at the time of the reform).
- That effort was blocked by a federal court that held that the DOL exceeded its authority by raising the salary level too high.
- The impact of the policy bundle on lifetime well-being depends significantly on the specific policy construction.
Qualifying for the EAP Exemption
The proposed changes would more than double the minimum salary threshold for EAP exempt workers, requiring compensation of $50,440 per year or $970 per week. The proposed changes would also increase the annual salary threshold from $100,000 to $122,148 for exemption as a highly compensated employee (“HCE”), as well as increase the motion picture producing industry exemption base rate from $695 to $1,404 per week. Currently, executive, professional and administrative employees who meet job-related duties tests and who earn a salary of at least $455 per week—$23,660 annually—are exempt from overtime under the FLSA. Under the proposed regulations, the minimum salary threshold for the white collar exemptions increases to $921 per week, and is set at the 40th percentile of weekly earnings for full-time salaried workers.
Preparing for the future is essential for organizations to remain competitive, Boughan noted. “Employers must stay informed about how these changes will affect their workplaces, while workers need to understand the skills they must acquire to remain competitive in an evolving job market,” she testified. The first increase in July 2024 is expected to affect approximately 1 million workers, Looman said, while the second increase in January 2025 is expected to affect approximately 3 million workers. Typically, a decision is made about the merits of a charge within 7 to 14 weeks, although certain cases can take much longer.
Final Rule: Employee or Independent Contractor Classification Under the Fair Labor Standards Act, RIN 1235-AA43
For 14- and 15-year-olds who are homeschooled, attend virtual school or have graduated high school, the bill would also remove restrictions on overnight work. On March 3, 2025, we updated Table 3 to include the 10-year deficit effects of the FY2025 House budget resolution’s spending and the Trump administration’s tax proposals, if enacted permanently. Dynamic distributional analysis considers how a policy affects households across the income and age distribution, including the unborn (represented by a negative age index at the time of the reform). It asks how much, on average, households in each (income, age) bucket value the proposed policy change over their entire lifetime, represented as a one-time transfer at the time of the policy change.
Currently, the United States Department of Labor (DOL) is currently proposing yet another set of revisions to the overtime rules—this time with particular respect to the exemptions for Executive, Administrative, Professional (EAP), Outside Sales, and Computer Employees. As a Florida business owner, it’s essential to stay informed about potential changes in labor laws that can impact your business operations. Munizzi Law Firm routinely advises business owners who think that they have a good grasp of labor laws, but find out that there is more to the story than they expected.
According to the DOL’s analysis, the salary level increase would mean that approximately 3.6 million workers could be newly eligible for overtime pay when they work over 40 hours in a week. Department of Labor (DOL) announced long-anticipated proposed changes to the Fair Labor Standards Act’s (FLSA) annual salary level threshold for exempt employees. Under the DOL’s proposed rulemaking, the annual salary level to qualify for exempt status would move from $35,568 to $55,068 per year for white-collar exemption positions. The DOL’s proposed rule aims to update and revise the regulations that determine whether certain white-collar salaried employees are exempt from minimum wage and overtime requirements under the Fair Labor Standards Act (FLSA). This exemption, known as the “white-collar” or “EAP” exemption, applies to employees in bona fide executive, administrative, or professional capacities.
Fact Sheet: Application Of The Fair Labor Standards Act To Domestic Service, Final Rule
Reclassifying roles as overtime-eligible could potentially increase labor costs, particularly if these positions frequently require that employees work more than 40 hours per week. Additionally, reclassification may also affect overall compensation packages if certain benefits are tied to exemption status. The misclassification of employees as independent contractors may deny workers minimum wage, overtime pay, and other protections. This final rule will reduce the risk that employees are misclassified as independent contractors while providing a consistent approach for businesses that engage with individuals who are in business for themselves.
