This week, the American Society of Association Executives (ASAE) submitted comments on the Department of Labor’s (DOL) proposed rule to dramatically increase the salary threshold at which full-time workers are eligible for overtime pay.
Under the federal Fair Labor Standards Act (FLSA), employees are entitled to receive overtime pay when they work over 40 hours per week, unless the employee is considered exempt from these requirements. Employees whose primary duties fall under the executive, administrative and professional (EAP) exemption, who are paid on a salary basis, and whose compensation meets the minimum salary level, are exempt from overtime requirements.
The Biden administration’s proposed rule will require that employers compensate full-time workers in EAP roles for any overtime worked if they make less than $55,068 annually. Currently, the salary threshold is $35,568. The DOL proposes a nearly 55 percent increase in the minimum salary level for overtime eligibility, ASAE said in its comments. DOL’s proposed rule change would raise the salary threshold to the 35th percentile of average weekly earnings of full-time salaried workers in the lowest-wage Census Region.
“While ASAE does not oppose an increase in the minimum salary level, it proposes a benchmark no higher than the 25th percentile of the average wages of full-time salaried workers in the lowest wage Census region,” ASAE said in its comments. “This would increase the minimum salary level above the current benchmark, without requiring dramatic changes to the budgets and organizational structures of nonprofit and for-profit employers that would be hard for those organizations to absorb and that could have unintended negative consequences for the impacted employees.”
ASAE added that DOL’s uniform minimum salary threshold disregards regional differences in the level of income needed to achieve a middle-class standard of living.
ASAE also joined a broad coalition of almost 90 associations in sending a letter to Congress last month urging DOL to reconsider its proposed rule that would make 3.6 million additional U.S. workers eligible for overtime pay.
This article was provided to OSAP by ASAE's Power of Associations and Inroads.