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ARTICLE · 18 MARCH 2014

Obama Administration Seeks Changes To Overtime Rules To Make More Workers Eligible For Overtime Pay: Possible Changes Include Altering Salary Basis, Primary Duties Tests For 'White-Collar' Exemptions

Bradley Arant Boult Cummings LLP
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President Barack Obama signed a presidential memorandum last week directing the U.S. Department of Labor to update its overtime regulations.

United StatesEmployment and HR
John Rodgers
John Rodgers

In a move that could affect nearly all employers, President Barack Obama signed a presidential memorandum last week directing the U.S. Department of Labor (DOL) to update its overtime regulations to make more employees eligible for overtime pay. Although the proposed changes have not been released yet, it is clear the move is designed to cause more employees to be classified as nonexempt under the Fair Labor Standards Act (FLSA) and thus eligible for time-and-a-half overtime pay.

Assuming the new regulations are enacted, a seismic shift in labor relations could ensue. Employers would have to ensure employees are correctly classified under the new regulations. In addition, if employees become eligible for overtime pay, management issues may emerge, as employers who previously didn't have to worry about certain employees' hours would have to start watching the clock.

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