Category Archives: Fair Labor Standards Act/FLSA

President Obama Signs Memorandum to Expand Eligibility for Overtime Pay

On March 13, 2014, President Obama signed a presidential memorandum directing the Department of Labor (DOL) to propose revisions to the Fair Labor Standards Act (29 USC 201 et seq.).  The revisions are to “update” and “modernize” existing regulations relating to white collar exemptions from overtime pay—and are expected to greatly expand the universe of employees who qualify for overtime. 

Current overtime rules (which require paying time-and-a-half for hours worked in excess of 40 hours/week) create exemptions for salaried workers in executive, administrative, and professional positions who earn more than $455/week – commonly referred to as “white collar” workers.  The President’s memorandum calls the existing white collar exemptions “outdated,” and says as a result, “millions of Americans lack the protections of overtime and even the right to minimum wage.”  The memorandum does not specify what the new regulations should include or what any new salary threshold should be. 

It’ll take some time!  Proposed rules are not expected until later this year, or perhaps the beginning of next year.  And new rules from the DOL will involve delays from a public comment period, and more. 

Will this matter in Oregon?  You bet.  We have our own state rules for “white collar” exemptions that are similar to the current federal rules, and those may remain unchanged under state law.  But the general rule when juggling state vs. federal wage and hour laws is “follow the wage and hour rule that’s most favorable to the employee.”  We expect these federal changes to be a game-changer for employers, so stay tuned for more.