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Department of Labor Intends to Extend Overtime Pay Requirements to More Workers

By Jill Desjean, NASFAA Policy & Federal Relations Staff

Last fall, the Department of Labor (DOL) published its 2021 regulatory priorities, which included plans to update the top salary level that would qualify for exemption from overtime pay (known as the “white collar exemption”) under the Fair Labor Standards Act (FLSA), which would result in a greater number of employees eligible for overtime pay. 

The threshold is currently set at $35,568. DOL originally planned to propose a new threshold in April through a Notice of Proposed Rulemaking (NPRM), although that timeline is now expected to be delayed. While DOL has not given indication of what that proposed threshold may be, it is facing pressure from some members of Congress who want to see the salary threshold increased by more than double, to as high as $82,732 by 2026. 

In February, the College and University Professional Association for Human Resources (CUPA-HR) drafted a letter cosigned by a number of higher education associations to DOL expressing concern about the impacts of increasing the overtime salary threshold on institutions, their employees, and the students they serve. 

The signers cited past attempts at changes to the threshold, including a 113% increase by President Barack Obama in 2014 which was ultimately enjoined by a federal court. During that process, CUPA-HR detailed the significant financial impacts such a change would have on institutions of higher education, and requested that DOL engage with the higher education community prior to beginning the upcoming rulemaking process to ensure fairness without unintended consequences. In response, DOL has scheduled listening sessions with higher education leaders for late March.

Stay tuned to Today’s News for updates on this issue.

 

Publication Date: 3/28/2022


Peter G | 3/28/2022 1:48:04 PM

Decent chance this is going to go exactly the same way the last cycle did. It will move forward in more or less this form (without careful consideration of whether that's really the appropriate salary threshold for a nationwide provision), schools will spend a great deal preparing to comply, and then Democrats will lose the white house in 2024 and it will be rescinded, and like GE and other issues we'll continue yoyo-ing back and forth rather than actually working out a sustainable solution.

I think the difference though is on the original pass (increase to ~43k) there was more wiggle room for schools to push some staff over the threshold. That's just not the case here, esp. as a blanket threshold for the entire country.

At the end of the day, I want to separate two issues: 1) A lot of staff are underpaid and overworked, particularly in FA. These are very real challenges. ED could help with the latter by dialing back regs, but they seem to have the opposite goal in mind.
2) Salary aside, converting from exempt to hourly has other costs and impacts to both the office and to staff in tracking, reporting, mandatory breaks under state and federal law that may not align with your preferred workstyle. Personally I would hate to go back to a non-exempt position. If I wanted to track the minutiae of my billable hours every day I'd have become a lawyer. Perhaps scheduling mandatory breaks would help my health, but realistically I'd just end up working through them anyway and then I'd be breaking the law.

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