Since 2015, the U.S. Department of Labor has been working to update the minimum wage and the "white collar" exemption under the Fair Labor Standards Act (FLSA). The effective new minimum salary level for the "white collar" exemption was to be raised as of December 1, 2016, from $23,660.00 per annum to $47,892.00 per annum, in what has been called the Overtime Final Rule. This left those employees who did not meet the minimum salary threshold as potentially qualifying for overtime pay. While employers frantically evaluated how these changes would affect their bottom line, a federal district judge in Texas granted a nationwide emergency preliminary injunction that prohibited the U.S. Department of Labor from enforcing the Overtime Final Rule. The case went up to the Fifth Circuit Court of Appeals, where in 2016 a stay was put in place while the U.S. Department of Labor considered formulating a new rule.
Recent revisions by the Department of Labor (DOL) have left employers in a spin. Previously under the Fair Labor Standards Act (FLSA), salaried employees earning $455 per week with, generally speaking, administrative or executive positions qualified as exempt from wage and overtime protection, meaning that employers were not required to pay those employees overtime. In order to modernize this "white collar" exemption, at President Obama's urging, the DOL evaluated national wage rates and, utilizing figures from the nation's poorest region, the South, increased the minimum salary to qualify for the exemption to $913 per week, or $47,476, annually. Designed to go into effect on December 1, 2016, the Overtime Final Rule immediately prompted employers to evaluate the effect this salary increase had on their employees.