To restore the effectiveness of the salary level test, the Department is setting the new standard salary level equal to the 40th percentile of weekly earnings for full-time salaried workers in the lowest-wage Census Region, currently the South. The Final Rule increases the standard salary level from $455* per week ($23,660 for a full-year worker) to $913* per week ($47,476 for a full-year worker).
In order to prevent the salary level requirements from again becoming outdated and ineffective, the Department is establishing mechanisms for automatically updating the salary and compensation levels every three years to maintain them at the levels set in this rulemaking.
Finally, for the first time, employers will be able to use nondiscretionary bonuses and incentive payments (including commissions) to satisfy up to 10 percent of the standard salary level, provided these payments are made on a quarterly or more frequent basis.
The Department is also setting the annual compensation level for certain HCEs equal to the annualized value of the 90th percentile of earnings for full-time salaried workers nationally ($134,004).