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DOL Announces 65% Increase to Overtime Threshold
The Department of Labor (DOL) has released its final overtime rule, significantly increasing the minimum annual salary threshold determining overtime pay eligibility under the Fair Labor Standards Act (FLSA) from $35,568 to $58,656.
The rule will gradually come into effect, with an increase to $43,888 on July 1, 2024, and an increase to $58,656 effective January 1, 2025.
The Details: DOL sets a salary threshold to ensure eligible employees receive overtime pay for all hours worked over 40 in a work week.
- Using 2023 data, the new salary threshold equals $1,128 per week or $58,656 annually for a full-year worker.
- The rule also increases the salary threshold for the highly compensated employee (HCE) exemption from $107,432 to $151,164 annually.
- The HCE exemption will also gradually come into effect, with an increase to $132,964 on July 1, 2024, and an increase to $151,164 effective January 1, 2025.
What’s New: The final rule includes an automatic update to the overtime threshold every three years based on available wage data at that time.
- The DOL expects to announce the first such update on July 1, 2027, which will affect both the standard salary and HCE thresholds.
- This methodology was specifically opposed by the National Restaurant Association and Restaurant Law Center in comments submitted last year.
Who’s Affected: Unless specifically exempted, an employee covered by the FLSA must receive pay for hours worked over 40 in a workweek at a rate not less than one and one-half their regular pay rate.
- Beginning on July 1, 2024, any employee earning under $43,888 will be owed overtime pay.
- On January 1, 2025, any employee earning under $58,656 will be owed overtime pay.
- This means that employees who were previously exempt from overtime pay may now be eligible, and employers may need to adjust their pay structures and work schedules accordingly.
Please see the DOL fact sheet linked here for information on determining if an employee is exempt.
Final rule on Pregnant Workers Fairness Act
The U.S. Equal Employment Opportunity Commission (EEOC) recently issued its final rule and interpretive guidance implementing the Pregnant Workers Fairness Act (PWFA), which became law last year. The final rule will take effect June 18.
Why it matters: The final rule aims to provide clarity and guidance regarding employers' obligations to accommodate pregnant employees and applicants with known limitations related to pregnancy, childbirth, or related medical conditions.
Learn more:
Bipartisan Senate Vote Supports Joint Employer Resolution; Veto Anticipated
Last week, the US Senate passed a resolution to overturn the controversial joint employer rule issued last year by the National Labor Relations Board. The resolution also passed in the US House. Despite this legislative success, President Biden has indicated he will veto the resolution. Meanwhile, legal efforts continue with the Texas Restaurant Association and the National Restaurant Association having successfully secured a temporary halt on enforcing the new rule, pending further appeals. The hospitality industry currently operates under the previous rule. Read more.
New Data Privacy Bill Raises Concerns
New legislation, called the American Privacy Rights Act of 2024 (APRA), aims to establish a comprehensive national framework for consumer data privacy and security.
The bill, introduced by a bipartisan, bicameral team—Senate Commerce Committee Chairman Cantwell (D-WA) and House Energy and Commerce Committee Ranking Member McMorris Rodgers (R-WA)—would establish national consumer data privacy rights and set standards for data security for qualifying organizations.
Where we stand: The NRA continues to be in favor of a reasonable data privacy bill that would preempt the existing patchwork of state laws, but APRA contains several poison pills.
- Specifically, the bill would threaten a restaurant’s ability to maintain loyalty programs and reach its customers through targeted advertising.
- Additionally, the bill does not go far enough to ensure this federal law would preempt state laws, and it unfortunately includes a private right of action as a key enforcement mechanism.
What’s next: The legislation is being referred to by some as a “discussion draft,” and its path forward in this Congress is uncertain. However, the NRA will continue to work with like-minded trade organizations and stakeholders on Capitol Hill to convey concerns with the bill and educate members on its potential impact.
US DOL Issues Final Rule to Clarify Rights to Employee Representation During OSHA Inspections
The U.S. Department of Labor today published a final rule clarifying the rights of employees to authorize a representative to accompany an Occupational Safety and Health Administration compliance officer during an inspection of their workplace.
The Occupational Safety and Health Act gives the employer and employees the right to authorize a representative to accompany OSHA officials during a workplace inspection. The final rule clarifies that, consistent with the law, workers may authorize another employee to serve as their representative or select a non-employee. For a non-employee representative to accompany the compliance officer in a workplace, they must be reasonably necessary to conduct an effective and thorough inspection.
The rule is effective on May 31, 2024. Learn more.
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