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Fact Sheet: The Impact of Proposed Federal Overtime Rule Changes on Colleges and Universities

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Fact Sheet: The Impact of Proposed Federal Overtime Rule Changes on Colleges and Universities

March 01, 2016

In March 2014, President Obama issued a memorandum directing the Secretary of Labor to make changes to the regulations governing exemptions to the Fair Labor Standards Act’s overtime pay requirements for executive, administrative and professional employees. The Department of Labor issued the proposed new rules in July 2015.

Under the current regulations, an individual is classified as a “white collar” employee exempt from federal overtime pay requirements if paid a salary of at least $23,600 annually and has duties that require independent judgment and discretion. Under the proposed rules, the salary threshold would be raised significantly so that current exempt employees making less than $50,440 in 2016 would no longer be “exempt,” requiring that they be paid on an hourly basis and entitled to overtime pay. The proposed rules would also require that this threshold level be raised annually.​​

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