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NY State Overtime Salary Threshold Increases for Exempt Executives and Administrative Employees — Effective December 31, 2016

A nationwide preliminary injunction now enjoins the U.S. Department of Labor from implementing its new white collar overtime exemption regulations that would have significantly increased the current salary threshold for the executive, administrative, and professional exemptions under the Federal Fair Labor Standards Act ("FLSA"). On November 22, 201 6, a federal district judge in Texas halted these increases, that had been scheduled to take effect on December 1, 2016. However, recent regulations that the New York State Department of Labor ("NYSDOL") adopted on December 28, 2016, and that are scheduled to go into effect in only two days, on Decemberal , 2016, will nevertheless increase the minimum salary thresholds for executive and administrative employees throughout New York State under the wage and hour provisions of the NYLL.

The NYSDOL published, on October 19, 2016, proposed amendments to New York State's minimum wage orders (the "Proposed Wage Orders") to increase the minimum wage and also to raise the thresholds for executive and administrative employees under the NYLL (the NYLL does require a minimum salary threshold for exempt professional employees). Presently, the minimum salary threshold for the executive and administrative employee exemptions (from overtime pay) under the NYLL is $675.00 per week ($35,100.00 per year). The NYSDOL has now adopted its Proposed Wage Orders without making any changes.

Accordingly, increases (based on employer size (in New York City) and location) will now go into effect (on December 31 , 2016) that will raise the minimum salary threshold to as high as $825.00 per week ($42,900.00 per year) for employers of 1 1 or more employees in New York City.

Employers throughout New York State must increase their exempt executive and administrative employees' salaries by December 31 , 2016 to meet the requirements of the newly adopted Final Rules. New York State employers will also need to decide whether to increase such salaries each year to match the annual increases required each December 31 by these Final Rules. In sum, even though New York State employers did not need to increase salaries on December 1, 2016 under the FLSA, New York State employers must now raise many executive and administrative employees' compensation on December 31 , 2016 to preserve the exempt (from overtime pay) status of such employees in New York State.

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About this Author

David I. Rosen, Sills Cummis Gross, Wrongful Dismissal Lawyer, Labor Arbitration Attorney

David I. Rosen has practiced labor and employment law on behalf of management clients since 1977. He handles employment litigation in the federal and state courts, before administrative agencies and through arbitration and mediation, and has broad experience with wrongful dismissal and employment discrimination claims, having successfully defended employers following jury and bench trials. His litigation experience extends to the enforcement and defense of restrictive covenants, NLRB unfair labor practice trials and appellate advocacy. Mr. Rosen also represents employers in labor...

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Galit Kierkut, Employment Litigation Attorney, Sills Cummis Gross, Social Media Matters Lawyer

Galit Kierkut concentrates her practice on employment litigation and counseling. She conducts human resources audits, performs management and employee training in all areas, including sexual harassment, social media and electronic communications use, and counsels clients regarding compliance with state and federal employment laws, including discrimination laws, the Fair Labor Standards Act (FLSA), family and medical leave, and the Worker Adjustment and Retraining Notification (WARN) Act. She also reviews and drafts employee handbooks, social media policies and employment contracts, including restrictive covenants and severance agreements. Her employment litigation practice is primarily focused on resolving claims in the areas of discrimination, sexual harassment, restrictive covenants, whistleblowing and employment contract disputes in state and federal courts and before the Department of Labor and the Equal Employment Opportunity Commission (EEOC).

Charles Kaplan, Sills Cummis Gross, Labor Employment Attorney, Affirmative Action Matters Lawyer

Charles H. Kaplan is a Member of the Sills Cummis & Gross Employment and Labor Practice Group and is resident in the Firm’s New York Office.  Mr. Kaplan represents employers in federal and state trial and appellate courts, as well as before enforcement agencies, including the U.S. Equal Employment Opportunity Commission, the National Labor Relations Board, the Office of Federal Contract Compliance Programs of the U.S. Department of Labor, the New York State Division of Human Rights, the New York State Department of Labor and the New York City Commission on Human Rights.