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Overtime Rule

Labor Department Issues Final Overtime Rule

On Sept. 24, the U.S. Department of Labor announced its Overtime Final Rule that adjusts the salary level test, part of a three-part test for determining when white-collar workers are exempt or must be paid overtime for working more than 40 hours in a week. The new rule raises the salary threshold for the white-collar exemption from overtime pay to $684 per week ($35,568 per year), up from the current level of $455/week ($23,660 per year). It also raises the salary threshold for highly compensated employees who are exempt from FLSA overtime pay requirements from $100,000 per year to $107,432 per year and allows employers to satisfy up to 10 percent of the standard salary level by using nondiscretionary bonuses and incentive payments.

The Final Rule goes into effect on January 1, 2020. The Labor Department rejected recommendations from some to phase-in the new salary thresholds over several years, adopt different levels based on geographic regions, or create carveouts for nonprofits or other sectors. The new rule does not alter the existing duties tests for executive, administrative, or professional employees, which also must be satisfied before an employee would be considered exempt.

View the National Council of Nonprofits’ resource page and read the new analysis, Understanding the New Overtime Final Rule

On Nov. 5, 2019, the National Council of Nonprofits hosted a webinar for an exploration of what the Overtime Final Rule means to nonprofit operations and missions, and what nonprofits should be doing now to prepare. The webinar featured officials from the U.S. Department of Labor and experts from groups representing workers and employers. Below are resources from the webinar:

Webinar Resources