What is the fate of the increase in the exempt level salary increase?

by Michael Haberman on April 10, 2017 · 0 comments

What will the Trump administration do with the FLSA?

As most of you know last December 1, 2016 the salary level that qualified an employee as being considered an exempt employee was supposed to increase. It did not. On November 22, 2015 a Texas judge issued an injunction to stop the increase from going into effect.  According to the National Law ReviewAs expected, on December 1, 2016, the Department of Justice (then under the President Obama administration), on behalf of the DOL, filed a notice with the U.S. Circuit Court of Appeals for the Fifth Circuit to appeal the order. The DOL sought to fast-track the appeal, asking the Fifth Circuit Court of Appeals for an expedited schedule.  The Fifth Circuit initially granted the request, and issued an order to expedite the legal arguments, with the DOL’s reply brief to be filed by February 7, 2017.” But then we had a change in administration! As a result the new administration filed for an extension to allow the new leadership of the DOL to figure out what they would want to do about pursing the stay. The Fifth Circuit granted them a delay until May 1, 2017.

Horns of a Dilemma

May 1 provides the Trump Administration with a looming dilemma. What is the Department of Labor going to do under a president who in his past has touted himself as being pro-labor and worker friendly, but is currently pro-business? Some people have suggested that the exempt salary level will go up, but not as steeply as was suggested by the Obama DOL, an increase from $23,660 to $47,476. Perhaps someone will suggest a compromise at a more palatable $35,000 per year. Would this assuage both sides? Perhaps, though for some companies that would still be a tough pill to swallow, but for many other companies, that would be an attractive amount to deal with. It would become more palatable if nonprofits got a break from that increase, perhaps an even smaller increase.

We will have to wait and see what happens at the end of this month.

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