DOL Issues New Opinion Letters on FLSA

Last week the Department of Labor issued three new FLSA opinion letters. One addressed the highly compensated exemption under the FLSA. The letter addressed the exempt status of paralegals in companies, but its application reaches further.

Under the FLSA regulations, highly compensated employees who earn a total compensation of $100,000 or more annually (can include bonuses and stipends) can be exempt from overtime eligibility if they meet the following three criteria:

• The $100,000 total compensation includes at least $455 per week paid on a salary basis;
• The primary duty of the employee is office or non-manual work;
• The employee performs at least one of the exempt duties of an executive, administrative or professional exempt employee.

The opinion letter stressed that while the employee must perform at least one of the duties of the three “white collar” exemptions, that duty does not need to be a primary duty of the employee. So, for instance, if an employee meets the compensation test of a highly compensated employee and occasionally supervises two or more employees, then they have met the administrative exemption test.

In this tight job market, where employers are paying never before heard of salaries to recruit and retain employees, it is important to remember that in exchange for this high salary, the employee might, in fact, be exempt from overtime requirements under the FLSA. Employers should note, though, that the threshold compensation limits may increase when (or if) the DOL regulations on white-collar exemptions change.