Issues with the proposed base salary level

Thank you for submitting your comments in response to the DOL’s proposal. Your Higher-Ed specific feedback to DOL on the likely effects the proposed rulemaking will have is critical. Once we receive your feedback, we will provide comments on the top line items found in the proposed rule. Please know that any and all information submitted by members will remain confidential in the final comments and that no institutional names will be referenced. The information you provide is strictly for the policy committee’s edification and will be compiled together along with the results from our survey to instruct and guide our final comments.

We thank you for your time and your constructive feedback on this critical issue.

Kind Regards,
CUPA-HR Government Relations Team

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* 1. State of survey participant

Issues with the proposed base salary level:

Currently, employers are not required to pay overtime (time-and-a-half) to salaried white collar workers who earn over $23,660/year assuming the duties test is met. DOL has proposed increasing that threshold to $50,440 as of 2016, which is the 40th percentile of earnings for all full time salaried workers. This is a 102% increase in the salary threshold. DOL considered several other alternative salary thresholds, including:

1. Adjusting the current level—which was set in 2004—for inflation, which would be $29,172. This equals approximately the 15th percentile of earnings for all full time salaried workers and is a 23 percent increase over the current threshold.

2. Applying the same formula used to update the salary in 2004, which was set to the 20th percentile of earnings for full time salaried employees in the South and retail. This would result in a minimum salary threshold of $30,004. This equals approximately the 15th percentile of earnings for all full time salaried workers and is a 27 percent increase over the current threshold.

3. Setting the new minimum threshold at median earnings for all wage and salaried workers combined, which is $40,352. DOL this median provides a “rough dividing line between the generally lower paid hourly workers, who are overtime protected and the generally higher-paid salaried workers who may be exempt. This equals approximately the 30th percentile of earnings for all full time salaried workers and is a 71 percent increase over the current threshold.

4. Adjusting the 1975 “short test” level for inflation, which would be $56, 316. This equals approximately the 50th percentile of earnings for all full time salaried workers and is a 138 percent increase over the current threshold.

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* 2. Which level do you think DOL should use? 

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* 3. Which job categories on campus will most likely need to be reclassified as a result of the increase?

How might the proposed increase to the minimum salary level alter how you compensate your employees? For example:

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* 4. Which employees are you likely to convert from currently exempt status to non-exempt? Those earning:

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* 5. Raise their salary to keep them exempt? Those earning:

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