While no changes in the laws have been made yet, last week the President issued a memorandum directing the Department of Labor to review the Fair Labor Standards Act (FLSA). The FLSA governs the requirement for paying overtime to non-exempt workers.
The FLSA sets standards for the basic minimum wage and overtime pay. It requires employers to pay covered employees at least the federal minimum wage and overtime pay of one and one half times their regular rate of pay. The FLSA also addresses recordkeeping and employment of children.
Some employees are exempt from the minimum wage and overtime pay requirements of the FLSA. These include:
- Executive, administrative and professional employees;
- Outside sales employees;
- Employees in certain computer-related occupations;
- Employees of certain seasonal amusement or recreational establishments;
- Employees of certain small newspapers;
- Seaman employed on foreign vessels;
- Employees engaged in fishing operations;
- Employees engaged in newspaper delivery
- Certain farm workers; and
- Casual babysitters employed as companions to the elderly or infirm.
President Obama suggests that the availability of overtime pay should be expanded. His memorandum directs the Department of Labor to raise the minimum salary level for qualifying for the exemption from $455 per week to take inflation into account.
He also suggests that the white-collar exemption for executive, administrative and professional employees be revised because some exempt employees under the present structure may not truly have administrative duties.
Any change by the Department of Labor will likely take months to vet and implement.
