Increased Minimum Weekly Salary for Exempt Employees in New York Effective December 31, 2016

On December 28, 2016, the New York State Department of Labor (NYSDOL) adopted regulations increasing the minimum weekly salary an employee must be paid as of December 31, 2016, to qualify as an exempt executive or administrative employee who is not eligible for overtime under New York State law. The regulations do not provide a salary requirement for the professional employee exemption (including both the learned professional and creative exemptions). New York employers must increase salaries to maintain the exempt status of employees under New York State law, even though the federal Fair Labor Standards Act (FLSA) exempt employee salary increases were blocked by a federal court nation-wide injunction in November 2016.

The new minimum weekly salary levels for New York State employers as of December 31, 2016, vary depending upon an employer’s size and location, as follows:

Increases effective December 31, 2016

New York City

• large employers (11 or more employees) $825 per week ($42,900 per year)
• small employers (10 or fewer) $787.50 per week ($40,950 per year)

Nassau, Suffolk, and Westchester Counties (regardless of size)

• $750 per week ($39,000 per year)

 Remainder of New York State (regardless of size)

• $727.50 per week ($37,830 per year)

The New York increases, first proposed in October 2016, received little attention because employers expected to have to raise the minimum weekly salary to a higher level of $913 per week ($47,476 per year) to maintain the exempt status of employees under federal law as of December 1, 2016. When a Texas federal court issued an injunction in late November 2016 blocking the new FLSA salary levels from going into effect nationwide, New York employers were left waiting to see if the proposed change in the New York minimum salaries would become effective. The NYSDOL did not publish its final wage orders until December 28, 2016, catching many by surprise.

The NYSDOL issued a summary of these changes (as well as changes in the minimum wage and allowances for tipped employees, meals, lodging, and uniforms) which can be found at https://www.labor.ny.gov/formsdocs/wp/Part142.pdf. 

The NYSDOL regulations also set forth future increases for New York employers, which also vary by employer location and size, as follows:         

New York City’s large employers (11 or more employees)

• $975 per week ($50,700 per year) on December 31, 2017
• $1,125 per week ($58,500 per year) on and after December 31, 2018
• None set (as yet) for future years

New York City small employers (10 or fewer)

• $900 per week ($46,800 per year) on December 31, 2017
• $1,012.50 per week ($52,650 per year) on December 31, 2018
• $1,125 per week ($58,500 per year) on and after December 31, 2019
• None set (as yet) for future years

Nassau, Suffolk, and Westchester Counties (regardless of size)

• $750 per week ($39,000 per year) on December 31, 2016
• $825 per week ($42,900 per year) on December 31, 2017
• $900 per week ($46,800 per year) on December 31, 2018
• $975 per week ($50,700 per year) on December 31, 2019
• $1,050 per week ($54,600 per year) on December 31, 2020
• $1,125 per week ($58,500 per year) on December 31, 2021

 
Rest of the State (regardless of size)

• $727.50 per week ($37,830 per year) on December 31, 2016
• $780 per week ($40,560 per year) on December 31, 2017
• $832 per week ($43,264 per year) on December 31, 2018
• $885 per week ($46,020 per year) on December 31, 2019
• $937.50 per week ($48,750 per year) on December 31, 2020
• December 31, 2021 not yet determined

Please do not hesitate to contact any of our attorneys if you have any questions regarding these changes.