DOL White Collar Overtime Exemption Rule

DOL White Collar Overtime Exemption Rule

WANADAês Dealer Law Briefing also covered overtime pay changes, which are formidable for employers. On May 18, 2016, the U.S. Department of Labor issued a rule dramatically increasing the salary level that must be met for –white collar” dealership employees to be exempt from overtime pay. The new rule does not change the duties test for white collar employees.

The rule raises the threshold for white collar employees executive, administrative, professional and computer from $23,660 to $47,476 per year. –Administrative,” the hardest to define, means the employee must use discretion to make decisions, Greenhaus said. The term can apply to business office workers or warranty clerks.

–It doesnêt matter what theyêre called or what their job description says,” said Greenhaus. –Itês what they do.”

Dealers should re-evaluate their white collar employees and make sure they are still exempt from overtime, he said. If they are now eligible for overtime, a dealer has several alternatives:

« Change the job to one paid on commission, not salary.

« Split the job between two people.

« Raise the employeeês salary so he or she is exempt from overtime.

« Pay overtime under the law. Make sure the employee clocks his or her hours accurately.

On June 20, the U.S. Supreme Court upheld the overtime exemption for service writers by returning an earlier decision to a lower court. The service writer exemption had been DOLês position for 20 years until a change in 2011. The recent decision is a victory for dealers after much hard work by NADA.

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