Salary threshold for exempt workers to rise

More workers in New York will be eligible for overtime payments under a Labor Department rule revision scheduled to go into effect on Jan. 1, 2020. Previously, the salary threshold required to consider a worker “exempt” from the provisions of the National Labor Relations Act was $23,660 annually. In addition, exempt workers must have a significant amount of autonomy or management authority in their positions. The rules finalized on Sept. 24, 2019, will make around 1.3 million more workers across the country eligible for overtime pay. The salary threshold will be raised to $35,568.

While this is a significant increase, it is substantially less than the change proposed under the Obama administration. The previous proposal would have raised the threshold to around $47,000 annually, making around 3 million additional workers eligible to receive overtime pay when they work over 40 hours each week. Widespread concern has been directed at companies that give management titles and responsibilities (including many workers at fast-food restaurants and retail stores) while paying low salaries and classifying these employees as exempt. In some cases, exempt management workers are required to work so many hours that they would make more receiving the federal minimum wage.

In New York, new overtime rules provide a higher salary threshold to keep workers eligible for overtime in an attempt to prevent abuse of the exemption rules. The salary threshold in New York is around $50,000. Many other states around the country are considering similar proposals as well.

Unfortunately, many workers continue to face misclassification, wage theft or unpaid overtime. An employment law attorney can provide advice to workers being deprived of their proper pay about how they can take action to seek compensation and accountability.

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