On August 30, 2023, the U.S. Department of Labor (“DOL”) released its proposed new rule on the “white collar” overtime exemptions. The new rule, which would be codified in a revised 29 C.F.R. Part 541, will be published shortly as a Notice of Proposed Rulemaking in the Federal Register, at which time a public comment period will open.

The source of the DOL’s authority to engage in rulemaking with respect to the “white collar” exemptions—i.e., those that relate to executive, administrative, learned and creative professional, outside sales, and computer employees—arises from Section 13(a)(1) of the Fair Labor Standards Act, which authorizes the Secretary of Labor to “define[] and delimit[] from time to time by regulations” the definitions of what it means to be employed “in a bona fide executive, administrative, or professional capacity.” (It is open to debate whether the entirety of the Part 541 regulations—including the right to set the minimum salary for exemption—is consistent with, or in excess of, this Congressionally-delegated authority.)

We’ve been expecting a revised overtime rule since President Biden took office. In the fall of 2021, the DOL targeted April 2022 for issuance of a proposed new rule. While the agency appeared focused on raising the minimum salary for exemption, some were hoping for a broader revision of Part 541, including more clarity and examples in certain of the duties tests for exemption. For better or worse, the changes in the proposed rule...

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