Is the fluctuating workweek changing?

On November 4, 2019 the U.S. Department of Labor (DOL) announced a proposal to expand access to bonuses for employees.

This announcement of a Notice of Proposed Rulemaking (NPRM) would allow employers to offer bonuses or other incentive-based pay to employees whose hours vary from week to week.

The proposal would revise the regulation for computing overtime compensation for salaried, non-exempt employees who work hours that vary each week (i.e., a fluctuating workweek) under the Fair Labor Standards Act (FLSA). It also clarifies that bonus and premium payments on top of fixed salaries are compatible with the fluctuating workweek method of compensation, and that supplemental payments must be included when calculating the regular rate of pay as appropriate under the FLSA. The proposal includes examples and minor revisions to make the rule easier to understand.

This proposed rule change is substantially similar to a proposal made by the DOL in 2008, which never went into effect.

According to the new U.S. Secretary of Labor, Eugene Scalia, this proposal offers more options for bonus pay and would allow employees to reap even more benefits from the competitive labor market.

“For far too long, job creators have faced uncertainty regarding their ability to provide bonus pay for workers with fluctuating workweeks,” Wage and Hour Division Administrator Cheryl Stanton said. “This proposed rule will provide much-needed clarity for job creators who are looking for new ways to better compensate their workers.”

This NPRM is available for public comment for 30 days. The DOL encourages employers to submit comments on the proposed rule.

If you need any assistance in the area of minimum wage or overtime or classifying workers as exempt from the FLSA, please email our firm or call the Law Office of David Miklas, P.A. at 1-772-465-5111.

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Law Office of David Miklas, P.A.

Labor & Employment law - Employers only