The Department of Labor has proposed a rule to raise the minimum salary workers must earn to qualify for "white collar" exemptions from $23,660 per year to $50,440 per year. According to the announcement, the proposed rule would move nearly 5 million workers from exempt (i.e. salaried) to non-exempt status (i.e. hourly and overtime-eligible). In California, employers typically ignore the DOL overtime rules since the CA requirements are more demanding. If you comply with the state rules, you more than satisfy the federal requirements. Will this new rule change that?
The answer is an unequivocal "maybe." CA is considering increasing the state minimum wage to $13 per hour effective July 1, 2017. The bill, SB 3, has passed the Senate and is being considered by the Assembly. If it passes and becomes law, the minimum salary for exempt status in California would increase to $54,080 (2 times the state minimum wage).
So if the DOL's proposed rule takes effect before SB3, you could have a situation where employees meet the state exemptions test, but not the federal. If that happens, employees making less than $50,440 would be non-exempt, those making over $54,080 could be exempt, and those in between could be in a hybrid class where the state exemption applies and the federal does not. Employees in the last category would presumably be entitled to weekly, but not daily overtime and would not be entitled to meal and rest periods. What could be simpler?
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