New Federal Overtime Rule

New Federal Overtime Rule

What California Employers Need to Know About the New Federal Overtime Rule

The U.S. Department of Labor announced the highly anticipated federal overtime rule under the Fair Labor Standards Act. This final rule changes the salary level that must be met before certain employees can be exempt from overtime.

But what does this new law mean for California employers?

Until recently, California employers were generally not concerned with federal overtime requirements because California's duties and salary tests for certain key exemptions were more stringent than federal requirements.

That changes as of December 1, 2016, when the federal salary requirement for the administrative, executive and professional exemptions will exceed California's salary test. When state and federal overtime laws apply, employers must follow whichever is more protective of employees.

CalChamber's free white paper covers the new federal overtime rule, its effects on how California employers pay their employees, and how you can prepare for the change.

Do you increase salaries or reclassify employees? It involves numerous issues so it's not a clear-cut decision.

About CalChamber

CalChamber is the largest, broad-based business advocate, working at the state and federal levels to influence government actions affecting all California business. As a not-for-profit, we leverage our front-line knowledge of laws and regulations to provide affordable, easy-to-use compliance products and services.

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