Members of the House and Senate introduced companion bills on June 11, 2019 to amend the Fair Labor Standards Act to raise the minimum salary threshold for exempt executive, administrative, and professional (“EAP”) employees to north of $50,000 and to automatically update the threshold every three years.

The “Restoring Overtime Pay Act of 2019” (H.R. 3197, introduced by Rep. Mark Takano of California) would legislate, for the first time in U.S. history, the minimum salary for exemption under the EAP exemptions—a matter that Congress has delegated to the rulemaking authority of the U.S. Department of Labor since the FLSA’s passage in 1938.  Sen. Sherrod Brown of Ohio introduced a similar bill in the Senate (S. 1786) on June 11.

The law would fix the salary threshold at a level equal to the 40th percentile of earnings of full-time salaried workers in the lowest-wage census region, as determined by the Bureau of Labor Statistics based on data from the second quarter of the calendar year preceding the calendar year in which such amount takes effect.  Representative Takano’s office notes that if the bill were enacted today, the salary level would increase to “nearly $51,000 per year.”

The bills intend to resuscitate the Obama Administration’s 2016 overtime rule, which would have raised the threshold salary for the EAP exemptions to $913 per week ($47,476 per year).  That rule was declared invalid by a Texas federal district court days before it was to take effect.

Unless and until this bill becomes law, the USDOL will continue to set the minimum salary for exemption, currently $455 per week ($23,660 per year).  The agency published a notice of proposed rulemaking to raise that threshold to $679 per week ($35,308 per year) in March 2019.

Will the bills become law?  Not likely, with Republicans holding a majority in the Senate and President Trump sure to veto the bills if they manage to pass both chambers.  Fans of stalled overtime legislation may remember the “Restoring Overtime Pay Act of 2017,” also introduced by Rep. Takano and seeking to peg the minimum salary for exemption at the same level as the recently-introduced bills.  That 2017 bill died in committee.

Print:
Email this postTweet this postLike this postShare this post on LinkedIn
Photo of Allan Bloom Allan Bloom

Allan S. Bloom is a nationally recognized trial lawyer and advisor who represents management in a broad range of employment and labor law matters. As a litigator, Allan has successfully defended a number of the world’s leading companies against claims for unpaid wages…

Allan S. Bloom is a nationally recognized trial lawyer and advisor who represents management in a broad range of employment and labor law matters. As a litigator, Allan has successfully defended a number of the world’s leading companies against claims for unpaid wages, employment discrimination, breach of contract and wrongful discharge, both at the trial and appellate court levels as well as in arbitration. He has secured complete defense verdicts for clients in front of juries, as well as injunctions to protect clients’ confidential information and assets.

As the leader of Proskauer’s Wage and Hour Practice Group, Allan has been a strategic partner to a number of Fortune 500 companies to help them avoid, minimize and manage exposure to wage and hour-related risk. Allan’s views on wage and hour issues have been featured in The New York TimesReutersBloomberg and Fortune, among other leading publications. His class-action defense work for clients has saved hundreds of millions of dollars in potential damages.

Allan is regularly called on to advise boards of directors and senior leadership on highly sensitive matters such as executive transitions, internal investigations and strategic workforce planning. He also has particular expertise in the financial services industry, where he has litigated and arbitrated cases, including at FINRA and its predecessors, for more than 20 years.
A prolific author and speaker, Allan was the Editor of the New York State Bar Association’s Labor and Employment Law Journal from 2012 to 2017. He has served as an author, editor and contributor to a number of leading treatises in the field of employment law, including ADR in Employment Law (ABA/Bloomberg BNA, Senior Editor), Employment Discrimination Law (ABA/Bloomberg BNA, Final Proof Editor), Cutting Edge Advances in Resolving Workplace Disputes (Cornell University/CPR, Editor), The Employment Law Review (Law Business Research, U.S. Chapter Author), and The Complete Compliance and Ethics Manual (SCCE, Chapter Author).

Allan is a member of the NYSBA’s House of Delegates, sits on the Executive Committee of the NYSBA’s Labor and Employment Law Section, and is a Fellow of the College of Labor and Employment Lawyers. He has been recognized as a leading practitioner by Chambers since 2011.