November 25, 2019, Vol. 10
by Marc Campsen

New Exemptions to Federal Wage Laws

Both Maryland wage laws and the federal Fair Labor Standards Act (“FLSA”) require payment of minimum wage and overtime for employees working more than 40 hours in a week. The Department of Labor (“DOL”) recently announced a new rule going into effect on January 1, 2020, exempting an anticipated 1.3 million additional employees from the FLSA.

Currently, full-time employees categorized as bona fide executive, administrative, professional, and outside sales employees (determined through duties tests not discussed here) are exempt from the FLSA’s requirements if those employees earn a minimum salary set forth in the FLSA.  The DOL’s new rule increases the existing minimum salary threshold to qualify for this exemption from $455/week to $684/week, which is equivalent to $35,568/year.  Notably, the new rule will permit employers to use nondiscretionary and incentive payments (including commissions) to satisfy up to 10 percent of the minimum salary threshold for this exemption.

Because the new rule has not taken affect, do not implement any changes to your wage payment policies until 2020.  Additionally, employers must still remain in compliance with Maryland wage laws.

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About The Author:

Marc A. Campsen is an attorney at Wright, Constable & Skeen, LLP, where he focuses his practice primarily on litigating employment and business law matters. He is recognized as a Maryland Super Lawyer.

DISCLAIMER: The materials available on this blog are for informational purposes only and not for the purpose of providing legal advice. You should contact your attorney to obtain advice with respect to your particular issue or problem.

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