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NEW FEDERAL REGULATIONS AFFECT EMPLOYEE'S OVERTIME PAY

11.13.16

New federal regulations governing who is eligible for overtime pay go into effect on December 1, 2016. The most significant rule change is the increase of the salary threshold to $47,476 per year or $913 per week, more than doubling the salary threshold from the prior rules.

With this change, any employee earning less than $47,476 per year, regardless of classification as a manager or professional, will be eligible for overtime pay for every hour worked over 40 hours per week. The burden is on the employer to track employees' hours worked each week and compensate eligible employees for overtime hours worked.

The new salary threshold is expected to expand the number of workers eligible nationally for overtime pay by 4.2 million, including an estimated 185,000 Pennsylvania workers. In addition to other changes in the regulations, the salary threshold is set to automatically increase every three years based on wage growth calculated by the U.S. Department of Labor.