ICBA expressed strong opposition to a Labor Department proposal that would increase the number of employees who are entitled to overtime compensation.
ICBA Opposition: In a comment letter on the proposal to increase the overtime exemption salary threshold for white-collar workers, ICBA said the change:
Would far outpace the rate of inflation and be unduly burdensome to small businesses.
Could force community banks to reduce staff, shorten business hours, curtail services, close branches, and reduce employees’ hourly pay.
Likely exceeds the department’s legal authority because it would arbitrarily require millions of employees who work in bona fide executive, administrative, or professional roles to be paid overtime.
Overtime Proposal: The Labor Department’s proposed rulemaking would raise the threshold for exempt salaried employees from $35,568 to $55,068 annually, requiring businesses to extend overtime pay to a greater number of executive, administrative, and professional workers.
Background: The Labor Department in 2019 issued an overtime final rule that was based on its 2004 overtime methodology, as advocated by ICBA. That final rule—which came after a federal judge in 2017 struck down a rule issued in 2016—increased the salary level test from $23,660 to $35,568 per year and the total annual compensation level for "highly compensated employees" from $100,000 to $107,432 per year.
