Employees covered by the FLSA must receive overtime pay for all hours worked
over 40 in a workweek at a rate of not less than one and one-half times
their regular rates of pay, unless otherwise exempt. The FLSA's "white
collar" exemptions exclude certain executive, administrative, and
professional ("EAP") employees, and outside salespersons, from
the federal minimum wage and overtime rules. Currently, to qualify for
exemption, white collar employees generally must: (1) be salaried, meaning
that they must be paid a predetermined and fixed salary that is not subject
to reduction because of variations in the quality or quantity of work
performed (the "salary basis test"); (2) be paid more than a
specified standard salary amount, which is currently $455 per week (the
equivalent of $23,660 annually for a full-year employee) in existing regulations
(the "salary level test"); and (3) primarily perform executive,
administrative, or professional duties, as provided in the DOL's regulations
(the "duties test").
The current regulations also contain a relaxed duties test for certain
employees (highly compensated employees) who receive total annual compensation
of $100,000 or more and are paid at least $455 per week.
President Obama issued a memorandum to the Secretary of Labor on March
13, 2014, directing the Secretary to modernize and streamline the existing
overtime regulations for executive, administrative, and professional employees.
The DOL has now complied with President Obama's request.