After months of anticipation by many employers, the DOL has released its Final Rule related to overtime this week. The Final Rule amends compensation levels for the Highly Compensated Employee (HCE) Exemption and the Executive, Administrative, and Professional (EAP) Exemptions. (The duties tests remain the same.) These levels were last updated in 2004.
The compensation for HCE will be set at an annual rate of $134,004, or equivalent to the 90th percentile of full-time salaried workers across the country. The EAP Exemption will be set at $47,476, indexed to the 40th percentile of the lowest-wage Census Region—at this time, the South. Importantly, the Rule also sets a method for updating the compensation levels automatically every three years to maintain the levels at those percentages.
By raising these pay thresholds, the Final Rule greatly increases the number of employees eligible for overtime protection. Many employers may modify the way they operate, taking measures to limit the work hours of employees or altering the structure of positions.
The changes become effective December 1, 2016. For more detail on the changes and how they may impact your operations, consult with employment counsel.
Last week, OSHA issued a final rule regarding the reporting of workplace hazards. Many employers are already required to keep records of injuries and illnesses. At this time though, little of this information about individual employers is made public. Under the new rule, employers in high-hazard industries that are already collecting data will send it to OSHA for posting on OSHA’s website. OSHA states that the availability of this data will enable employees to choose workplaces where injury risk is lowest, and employers that wish to hire the best workers will make prevention a priority.
Under the rule, employers with 250 or more employees in industries covered by the Recording and Reporting Occupational Injuries and Illnesses regulation must electronically submit information. Employers with 20-249 employees in certain industries must electronically submit more-limited information as well.
New requirements take effect August 10, 2016, with submissions to OSHA beginning in 2017. The obligations to complete and retain injury and illness records under the recordkeeping regulation remain unchanged.
According to the Bureau of Labor Statistics, over three million workers suffer a workplace injury or illness annually. Assistant Secretary Michaels states, “Since high injury rates are a sign of poor management, no employer wants to be seen publicly as operating a dangerous workplace. Our new reporting requirements will ‘nudge’ employers to prevent worker injuries and illnesses to demonstrate to investors, job seekers, customers and the public that they operate safe and well-managed facilities.”