The US Department of Labour has announced a final rule (the new rule) that updates several regulations regarding what forms of payment employers can exclude in the time-and-a-half calculation for overtime pay. The new rule clarifies that employers can exclude a range of employee perks and state-mandated payments in calculating overtime under federal law. Employers should review their pay practices with the new rule in mind.
In the three-year saga over anticipated changes to the minimum salary threshold for overtime exemptions under the Fair Labour Standards Act, the latest – and probably final – development occurred on 24 September 2019, when the US Department of Labour issued its new final rule updating the regulations in this regard. The new regulations will become effective on 1 January 2020. As such, employers must evaluate their workforces to identify positions that will need to be reclassified or modified.