Several CUNA changes in OT rule, CU concerns remain
Further CUNA analysis of the U.S. Department of Labor’s overtime rule found minor relief, but CUNA remains concerned about the increased burden on credit unions. Several CUNA-suggested changes were included, but CUNA believes credit unions, especially smaller credit unions and thosein rural and underserved areas will still face regulatory burdens as a result of the rule.
Compliance with the rule is required by Dec. 1.
CUNA’s advocacy efforts on this rule includes writing to both the DOL and NCUA to seek relief for credit unions who we believe are disproportionately impacted by this rule. CUNA also shared concerns with the Small Business Administration’s Office of Advocacy, and supported legislation and sent letters to Congress seeking reforms to this rule.
CUNA suggested changes to the rule include:
Lowering the salary threshold to $913 weekly, down from the proposed $970 weekly. CUNA asked the DOL to re-evaluate its proposed threshold, which it believed was not appropriate for credit union employees, particularly those in rural and underserved areas.
Automatically updating the salary threshold every three years, instead of the proposed update each year, with only 60 days required notice. CUNA still opposes automatically updating the salary level at any fixed percentile range. However, updating every three years with at least 150 days notice is an improvement; and
- Leaving the standard duties test untouched. The DOL said in the proposal it was considering revisions in order to ensure the tests fully reflect the purposes of the exemption, but made no changes in the final rule.
While the DOL made some changes to the salary threshold, it is still approximately twice the previous threshold, and today’s final rule will sweep in a large number of credit union employees.
CUNA is currently fully analyzing the final rule and encourages credit unions to consult with employment attorneys to determine how to best comply.
A detailed initial analysis of the final rule is available on CUNA’s Removing Barriers Blog.