content top


Egbert_John_web2Under the federal Fair Labor Standards Act (“FLSA”), most employees are entitled to receive overtime compensation (1.5 times their regular rate of pay) for all hours they work above 40 hours in a workweek.  However, the FLSA also exempts certain executive, administrative and professional employees who are paid on a salaried basis and make at least $455 per week.  President Obama announced last week that he is directing the U.S. Department of Labor (the agency charged with enforcing the FLSA) to amend its regulations to raise that salary threshold.

The legal effect of this change is that employers will have to begin paying overtime compensation to some of their employees who would otherwise be exempt from the overtime pay requirement.  For example, a store manager of a restaurant earning a $25,000 salary who is exempt under the current regulations would no longer be exempt under the new regulations.  The employer will either have to reconfigure the job duties or pay structure of the job, or it will have to determine what that employee’s regular rate of pay is (which will vary from week to week, depending on the number of hours the employee actually works) and then pay that employee additional compensation based on that regular rate, above and beyond the agreed-upon salary, for every hour worked above 40.

Employers affected by this change should consult with their attorney to determine what options may be available.

John J. Egbert is Chair of the firm’s Labor and Employment Practice Group and serves as the firm’s General Counsel. He assists employers with all types of employment litigation, including discrimination, wrongful discharge, wage and hour and non-compete agreements. Mr. Egbert also frequently advises clients on employment policies and procedures, and represents employers before administrative agencies.

Legal Disclaimer

Please note that the materials contained within this web site have been prepared by Jennings, Strouss & Salmon, P.L.C. for informational purposes only so that readers may learn more about the firm, the services it provides the background of its attorneys, and recent developments in the law. These materials do not constitute, and should not be considered, legal advice, and you are urged to consult with an attorney on your own specific legal matters. Transmission of the information contained in the Jennings, Strouss & Salmon web site is not intended to create, and receipt by the reader does not constitute, an attorney-client relationship with Jennings, Strouss & Salmon or any of its individual attorneys. While we would certainly like to hear from you, we cannot represent you until we know that doing so will not create a conflict of interest. Please do not send us any information about a matter that may involve you until you receive written authorization to do so from one of our attorneys. Unless otherwise indicated in individual attorney biographies, attorneys resident in the firm's various offices are not certified by the Board of Legal Specialization or a similar body of any State. This site may contain hyperlinks to Web sites operated by parties' independent from Jennings, Strouss & Salmon. Such hyperlinks are provided for your reference only. Jennings, Strouss & Salmon does not control such Web sites, and is not responsible for their content. Jennings, Strouss & Salmon's inclusion of hyperlinks to such Web sites does not imply any endorsement of the material on such Web sites or any association with their content. Your access and use of such sites, including information, material, products, and services therein, shall be solely at your own risk. Further, because the privacy policy of this Site is applicable only when you are on this Site, once linked to another Web site, you should read that site's privacy policy before disclosing any personal information.