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U.S. Department of Labor Proposes Changes to Minimum Salary for Overtime Exemptions

March 11, 2019

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On March 7, 2019, the United States Department of Labor issued a notice of proposed rulemaking that would change the minimum salary levels necessary for an employee to be properly classified as exempt from the overtime compensation requirements of the Fair Labor Standards Act.  Under the proposed rule, the minimum salary for most exemptions would rise from $455 per week ($23,660 annualized) to $679 per week ($35,308 annualized).  The minimum annual compensation for the “highly compensated employee” exemption would rise from $100,000 to $147,414.

For employees in the executive, administrative and professional exemptions, the proposed rule would permit nondiscretionary bonuses and incentive payments (including commissions) to satisfy up to ten percent (10%) of the required minimum salary.  In addition, provided that the employee has received at least ninety percent (90%) of the required minimum compensation in each payroll week for 52 weeks, the employer would be permitted to make a

Supreme Court Rejects “Narrow” Reading of Overtime Exemption and Concludes that Auto Dealership Service Advisors are Exempt From Overtime

On its second trip to the U.S. Supreme Court, a six-year-long dispute between five auto dealership employees and their employer came to an end when the Supreme Court found that the employees were properly classified as exempt employees under the Fair Labor Standards Act (“FLSA”).  In the case, plaintiffs Hector Navarro and four other employees worked as service advisors—employees who meet and greet customers bringing their cars to dealerships for service or maintenance and suggest and sell such services to customers.

The service advisors in this case filed suit in 2012, claiming back pay under the FLSA for hours worked in excess of 40 in a week on the basis that they were misclassified as exempt.  Specifically, the employees argued that they neither sold nor repaired vehicles and, therefore, were improperly denied overtime in violation of the FLSA.  The employees also alleged violation of California state wage and hour laws.

Mandatory Paid Sick Leave for Arizona Employees: How Proposition 206 Impacts Your Business

After surviving a legal challenge rejected by the Arizona Supreme Court, Arizona’s $10 minimum wage enacted under Proposition 206 is already in effect, and the sick leave portion of the law takes effect in July. For many companies, this will require new paid time off and sick leave policies, or at least revisions to their existing policies.

With enactment of Proposition 206, Arizona joins other states with sick leave laws, including Illinois, California, Oregon, Washington, Massachusetts, Vermont, and Washington, D.C. As previously reported by the Bryan Cave Retail Law blog, the Illinois law took effect in January 2017.

The Arizona law generally applies to all Arizona employees; it makes no distinction between salaried, hourly, full-time, part-time, temporary or seasonal employees. All employees must accrue one hour of paid sick time for every 30 hours worked.

Paid sick leave can be used for medical care of a mental or physical illness,

House Passes Bill to Reduce Overtime

May 25, 2017

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On May 3, 2017, the House of Representatives passed H.R. 1180, Working Families Flexibility Act, a law that would amend the Fair Labor Standards Act, to allow employers to give workers paid time off or comp time instead of time-and-a-half overtime pay.  Under the Act, comp time could only be provided in lieu of overtime if it is part of a collective bargaining agreement that was negotiated with the labor organization.  For non-union employees, the employee must have knowingly and voluntarily agreed to the comp time.  There are other conditions such as the employee working a minimum 1,000 hours in a 12-month period before he or she can agree to comp time, as well as limitations, including a maximum accrual of 160 hours of comp time and a mandatory payout of compensation for any unused and accrued comp time by the end of calendar year.  See H.R. 1180 at

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