On September 24, 2019, the U.S. Department of Labor announced a final revision to the salary level which defines which employees may be classified as “exempt” under the Fair Labor Standards Act. The final rule is effective January 1, 2020.

The final rule:

  • raises the “standard salary level” to $684 per week ($35,568 per year) from the current level of $455 per week;
  • raises the total compensation level from “highly compensated employees” (HCE) to $107,432 from the current level of $100,000;
  • allows employers to use non-discretionary bonuses and incentives payments (including commissions) that are paid at least annually to satisfy up to 10% of the standard salary level;
  • revises the special salary levels for workers in U.S. territories and in the motion picture industry.

Detailed information can be found on the U.S. DOL Fact Sheet.

If you are unsure how this affects your business, please feel free to contact Shafer HR Solutions at 865.292.1136 or cbarnes@shaferinsurance.com.

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