Analysis of the Department of Labor's Proposed Changes Under the Fair Labor Standards Act.

Mondaq Business Briefing, June, 2003 by Thomas J. et al Flaherty

By Thomas J. Flaherty, Elizabeth A. Lalik and Blake M. Guy

Introduction and Overview

On March 31, 2003, the Department of Labor ("DOL") published proposed regulations that redefine the "white collar" exemptions under the Fair Labor Standards Act ("FLSA" or the "Act"). The proposed rules would substantially modify which employees are "exempt" from the minimum wage and overtime requirements of the FLSA, and would alter the tests employers use to classify their employees as "exempt" or "non-exempt" under the Act.

There are several key changes in the proposed rules:

1. Special rule for "highly compensated employees": if an employee makes $65,000 or more annually and he/she performs any one of certain "exempt" duties, that employee is...