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January 01, 2020

Rule extends overtime pay to more workers

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Veterinary practices may be affected by a federal rule that extends overtime pay requirements to workers making a salary of less than $35,568 per year.

The U.S. Department of Labor rule went into effect Jan. 1, raising the earnings threshold needed to exempt executive, administrative, or professional employees from the Fair Labor Standards Act overtime pay requirements. 

The changes will make 1.3 million workers eligible for overtime pay, according to the Department of Labor. The overtime rule requires that an employer pay at least 1.5 times nonexempt workers’ regular pay for any hours worked over a 40-hour workweek.

Banfield Pet Hospital, the biggest chain of animal hospitals in the U.S., declined to comment. The American Animal Hospital Association and the Veterinary Hospital Managers Association did not respond to requests for comment by press time in late November.

In 2016, the Department of Labor proposed an update to the overtime rule that would have raised the salary cutoff to $47,476 per year for employees to be exempt from overtime pay, but a federal judge in Texas blocked the rule before it could take effect. The last update was in 2004, then putting the threshold for workers to qualify for time and a half at $23,476. In 2019, the Department of Labor announced a final rule raising the threshold to $35,568, effective this year.

In the final rule, the Department of Labor also reaffirmed its intent to update the earnings threshold more regularly in the future.