Changes in employment legislation in the USA; higher salary costs

As of December 1, 2016, a new set of rules shall apply to overtime payment in the US.

All overtime – number of hours worked over 40 per work week – is subject to at least 50% additional payment; that hasn’t changed.

Overtime is paid to so-called non-exempt employees. The US have a system of exempt (white collar) and non-exempt (most workers) employees.

Exempt employees – like executive, administrative and professional employees - are not entitled to certain employment benefits, like overtime payment (white collar exemptions, which can be considered in the employer’s interest).

What has changed is the level or remuneration for employees to be considered exempt; that level has increased to US$ 47,476 gross annually (with some exceptions). In general, should any currently designated exempt employees earn less than US$ 47,476, it will result in (substantially) increased salary costs for the employer.

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