By Megan Erickson Moritz
The new
overtime regulations were officially published on May 23, which among other
things, more than doubles the salary level requirement for exemption under the
Executive, Administrative, and Professional (so-called “white collar”)
exemptions under the FLSA. At the same time the final rule was published,
the agency also published in the Federal Register a “time-limited
non-enforcement policy for providers of Medicaid-funded services for
individuals with intellectual or developmental disabilities in residential
homes and facilities with 15 or fewer beds.” The regs are effective Dec 1,
2016; however, the agency has announced that for this limited category of employers,
it will not enforce the new salary level until March 27, 2019. This means
the current salary level of $455 per week will continue to apply to employees
working in these small residential homes and facilities with 15 or fewer beds
and providing Medicaid-funded services to people with certain disabilities.
While this is
welcomed news to this subset of organizations, do keep in mind the effective
date of the new Final Rule remains December 1, 2016. Although this policy
announcement means the DOL will not take agency action to enforce the
new salary level for this segment of employers, the agency’s non-enforcement
policy does not protect these employers from private lawsuits by
employees. Additionally, these employers should keep in mind this limited
non-enforcement policy only applies to the new salary requirement, and not to
other FLSA compliance issues (such as the duties test requirements for the
exemptions).
Employers who
have questions about the application of this policy, would like help evaluating
their policies and practices, or are interested in a customized wage and hour Audit or assistance with reclassifying
employees, may contact Megan Moritz
or another member of our Employment &
Labor Law Practice Group for
more information.
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