I 

114TH CONGRESS 

2D SESSION H. R. 4773 

To require the Secretary of Labor to nullify the proposed rule regarding 

defining and delimiting the exemptions for executive, administrative, professional, outside sales, and computer employees, to require the Secretary 

of Labor to conduct a full and complete economic analysis with improved 

economic data on small businesses, nonprofit employers, Medicare or 

Medicaid dependent health care providers, and small governmental jurisdictions, and all other employers, and minimize the impact on such 

employers, before promulgating any substantially similar rule, and to 

provide a rule of construction regarding the salary threshold exemption 

under the Fair Labor Standards Act of 1938, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

MARCH 17, 2016 

Mr. WALBERG (for himself and Mr. KLINE) introduced the following bill; 

which was referred to the Committee on Education and the Workforce 

A BILL 

To require the Secretary of Labor to nullify the proposed 

rule regarding defining and delimiting the exemptions 

for executive, administrative, professional, outside sales, 

and computer employees, to require the Secretary of 

Labor to conduct a full and complete economic analysis 

with improved economic data on small businesses, nonprofit employers, Medicare or Medicaid dependent health 

care providers, and small governmental jurisdictions, and 

all other employers, and minimize the impact on such 

employers, before promulgating any substantially similar 

rule, and to provide a rule of construction regarding 


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the salary threshold exemption under the Fair Labor 

Standards Act of 1938, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Protecting Workplace 

5 Advancement and Opportunity Act’’. 

6 SEC. 2. FINDINGS. 

7 Congress finds the following: 

8 (1) The proposed rule of the Department of 

9 Labor entitled ‘‘Defining and Delimiting the Exemp10 tions for Executive, Administrative, Professional, 

11 Outside Sales and Computer Employees’’ (80 Fed. 

12 Reg. 38516 (July 6, 2015)) provides a minimum sal13 ary requirement that would be— 

14 (A) a 113-percent increase during the first 

15 year after the final rule takes effect from the 

16 salary threshold in effect on February 29, 

17 2016; and 

18 (B) an increase that would set the Federal 

19 minimum salary threshold 20-percent higher 

20 than the minimum salary threshold under any 

21 State law effective on the date of enactment of 

22 this Act. 

23 (2) The Secretary significantly underestimated 

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1 posed rule. Public comments calculate such rule will 

2 impose financial and nonfinancial costs substantially 

3 higher than those estimated by the Department. 

4 (3) According to the Office of Advocacy of the 

5 Small Business Administration, the initial regulatory 

6 flexibility analysis of the July 6, 2015, proposed rule 

7 required under section 603 of title 5, United States 

8 Code, failed to adequately identify the number of 

9 small entities affected by such rule and failed to ad10 dress how such rule would affect regions with lower 

11 costs of living and differences in certain industries. 

12 On September 4, 2015, the Office of Advocacy of 

13 the Small Business Administration submitted com14 ments to the Secretary regarding such rule, includ15 ing recommendations to— 

16 (A) reanalyze ‘‘the economic impact of this 

17 rule on small businesses’’, to ‘‘provide a more 

18 accurate estimate of the small entities impacted 

19 by this proposal’’, and to ‘‘include an analysis 

20 of industry sub-sectors, regional differences, 

21 and revenue sizes’’; 

22 (B) reanalyze ‘‘the number of small non23 profit organizations and small governmental ju24 risdictions . . . that are affected by this rule 


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1 and the economic impact of this rule on these 

2 entities’’; and 

3 (C) provide greater transparency with re4 spect to ‘‘compliance cost data’’ and to ‘‘utilize 

5 data provided in the comment process to accu6 rately estimate the human resources and finan7 cial management costs of this regulation’’. 

8 (4) The Secretary did not consider the potential 

9 impact of the July 6, 2015, proposed rule on work10 place flexibility. Public comments address concerns 

11 that employees who are reclassified from exempt to 

12 nonexempt employees may no longer be able to par13 ticipate in workplace flexibility arrangements and 

14 programs. 

15 (5) The Secretary did not analyze the potential 

16 impact of the July 6, 2015, proposed rule on compa17 nies that operate in multiple States with different 

18 costs of living and different salary scales, and the 

19 costs and unique complications for these employers 

20 associated with reclassifying thousands of employees 

21 in multiple States. 

22 (6) The July 6, 2015, proposed rule automati23 cally updates the salary threshold on an annual basis 

24 for purposes of defining employees subject to the ex25 emption under section 13(a)(1) of the Fair Labor 


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1 Standards Act of 1938 (29 U.S.C. 213(a)(1)) for all 

2 subsequent years, contrary to the requirement under 

3 such section that the definitions applicable for the 

4 exemption shall be ‘‘defined and delimited from time 

5 to time by regulations of the Secretary’’. The Sec6 retary does not have the authority to increase the 

7 salary threshold on an annual or other basis without 

8 conducting notice and comment rulemaking with re9 spect to each change in accordance with section 553 

10 of title 5, United States Code. 

11 (7) Although not proposed in the July 6, 2015, 

12 proposed rule, the Secretary indicated that changes 

13 to the duties tests may be included in the final rule, 

14 without providing for notice and comment regarding 

15 the specific proposed revisions. 

16 SEC. 3. DEFINITIONS. 

17 In this Act: 

18 (1) DEPARTMENT.—The term ‘‘Department’’ 

19 means the Department of Labor. 

20 (2) JULY 6, 2015, PROPOSED RULE.—The term 

21 ‘‘July 6, 2015, proposed rule’’ means the proposed 

22 rule of the Department of Labor entitled ‘‘Defining 

23 and Delimiting the Exemptions for Executive, Ad24 ministrative, Professional, Outside Sales and Com25 puter Employees’’ (80 Fed. Reg. 38516 (July 6, 


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1 2015)) or the final rule with respect to such pro2 posed rule. 

3 (3) MEDICARE OR MEDICAID DEPENDENT

4 HEALTH CARE PROVIDER.—The term ‘‘Medicare or 

5 Medicaid dependent health care provider’’ means an 

6 employer who derives more than 50 percent of its 

7 revenue from payments under the Medicare program 

8 under title XVIII of the Social Security Act, a State 

9 plan under the Medicaid program under title XIX of 

10 such Act, or both. 

11 (4) SECRETARY.—The term ‘‘Secretary’’ means 

12 the Secretary of Labor. 

13 (5) SMALL BUSINESS; SMALL ENTITY; SMALL

14 GOVERNMENT JURISDICTION; SMALL ORGANIZA15 TION.—The terms ‘‘small business’’, ‘‘small entity’’, 

16 ‘‘small government jurisdiction’’, and ‘‘small organi17 zation’’ have the meanings given such terms in sec18 tion 601 of title 5, United States Code. 

19 (6) SUBSTANTIALLY SIMILAR RULE.—The term 

20 ‘‘substantially similar rule’’ means any rule or pro21 posed rule that is a reissuance of the July 6, 2015, 

22 proposed rule in substantially the same form as such 

23 rule, or is the issuance of a new rule or proposed 

24 rule that is substantially the same as the July 6, 

25 2015, rule, including any rule that implements the 


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1 provisions of section 13(a)(1) of the Fair Labor 

2 Standards Act of 1938 (29 U.S.C. 213(a)(1)). 

3 SEC. 4. CONDITIONS PRECEDENT FOR SUBSTANTIALLY 

4 SIMILAR RULES. 

5 (a) ENFORCEMENT.— 

6 (1) IN GENERAL.—Beginning on the date of en7 actment of this Act, the July 6, 2015, proposed rule 

8 shall cease to have any force or effect. 

9 (2) FINAL RULE.—In the case that the July 6, 

10 2015, proposed rule is a final rule on the date of en11 actment of this Act— 

12 (A) the Secretary shall not enforce the 

13 final rule based on conduct occurring before 

14 such date of enactment; 

15 (B) an employee shall not have any right 

16 of action against an employer for the employ17 er’s failure to comply with the final rule at any 

18 time prior to such date of enactment; 

19 (C) any regulations that were amended by 

20 such final rule shall be restored and revived as 

21 if the final rule had never taken effect; and 

22 (D) nothing in this Act shall be construed 

23 to create a right of action for an employer 

24 against an employee for the recoupment of any 

25 payments made to the employee prior to the 


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1 date of enactment of this Act that were in com2 pliance with such final rule. 

3 (b) CONDITIONS FOR SUBSTANTIALLY SIMILAR

4 RULES.— 

5 (1) IN GENERAL.—The Secretary may promul6 gate any substantially similar rule, subject to para7 graph (3), only if the Secretary has completed each 

8 action required under paragraph (2). 

9 (2) REQUIREMENTS FOR SUBSTANTIALLY SIMI10 LAR RULES.—The actions required under this para11 graph are the following: 

12 (A) The Secretary shall conduct an anal13 ysis of the impact of the substantially similar 

14 rule, including an initial regulatory flexibility 

15 analysis under section 603 of title 5, United 

16 States Code, and assessments under clauses (i) 

17 through (iii) of section 6(a)(3)(C) of Executive 

18 Order 12866 (5 U.S.C. 601 note, relating to 

19 regulatory planning and review) to be provided 

20 to the Administrator of the Office of Informa21 tion and Regulatory Affairs in accordance with 

22 such section, and that— 

23 (i) accurately identifies the number of 

24 affected small entities by using specific 

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1 tion of the Statistics of U.S. Businesses by 

2 the Bureau of the Census; 

3 (ii) addresses regional, State, county 

4 (if applicable), metropolitan, and non5 metropolitan salary and cost-of-living dif6 ferences; 

7 (iii) provides an analysis of any sub8 stantially similar rule, which shall include 

9 the percentile of full-time salaried workers 

10 affected, and such analysis shall be 

11 disaggregated by— 

12 (I) State; 

13 (II) industry subsector; 

14 (III) small organizations; 

15 (IV) small government jurisdic16 tions, including further disaggregation 

17 by school district; 

18 (V) nonprofit organizations; 

19 (VI) Medicare or Medicaid de20 pendent health care providers; and 

21 (VII) small businesses; 

22 (iv) provides an analysis of manage23 ment and human resource costs for all em24 ployers, including costs associated with 

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1 sifying employees, and extra hours spent 

2 scheduling employees; 

3 (v) provides an analysis of the impact 

4 on lower-wage industries, including by geo5 graphic area; 

6 (vi) provides an analysis of all non7 financial costs, including impact on em8 ployment, workplace flexibility, employee 

9 benefit structure for exempt and non10 exempt workers, career advancement op11 portunities, new business formation, busi12 ness termination, and loss of market share 

13 to foreign competition; and 

14 (vii) includes a complete description of 

15 any significant alternative as described in 

16 section 603(c) of title 5, United States 

17 Code, to the substantially similar rule. 

18 (B) The Secretary shall publish not less 

19 than one small entity compliance guide under 

20 section 212 of the Small Business Regulatory 

21 Enforcement Fairness Act of 1996 (5 U.S.C. 

22 601 note) to assist small entities in complying 

23 with the substantially similar rule. 

24 (C) The Secretary shall provide notice of 

25 the substantially similar rule in the Unified 


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1 Agenda of Federal Regulatory and Deregula2 tory Actions, compiled by the Regulatory Infor3 mation Service Center of the General Services 

4 Administration. 

5 (D) The Secretary shall ensure that the ef6 fective date for any final rule with respect to 

7 the substantially similar rule shall not be less 

8 than 1 year after the publication of such final 

9 rule in the Federal Register. 

10 (E) The Secretary shall comply with the 

11 notice and comment requirements under section 

12 553 of title 5, United States Code, and provide 

13 a comment period of not less than 120 days. 

14 (3) AUTOMATIC UPDATES.—Any substantially 

15 similar rule promulgated by the Secretary shall not 

16 contain any automatic updates to the salary thresh17 old for purposes of the exemption under section 

18 13(a)(1) of the Fair Labor Standards Act of 1938 

19 (29 U.S.C. 213(a)(1)), in accordance with section 5. 

20 SEC. 5. RULE OF CONSTRUCTION. 

21 The requirement under section 13(a)(1) of the Fair 

22 Labor Standards Act of 1938 (29 U.S.C. 213(a)(1)) that 

23 the definitions applicable for the exemption under such 

24 section be ‘‘defined and delimited from time to time by 

25 regulations of the Secretary’’ shall be construed to— 


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1 (1) require the Secretary to issue a new rule 

2 through notice and comment rulemaking in accord3 ance with section 553 of title 5, United States Code, 

4 for each change in any salary threshold under such 

5 section 13(a)(1) proposed by the Secretary; and 

6 (2) exclude any rule that would result in 

7 changes to any salary threshold under such section 

8 for multiple time periods, including through any 

9 automatic updating procedure. 

10 SEC. 6. REQUIREMENTS FOR DUTIES TESTS. 

11 The Secretary may not promulgate any final rule that 

12 includes any provision revising any of the duties tests pro13 vided in part 541 of title 29, Code of Federal Regulations 

14 (or any successor regulation), for exemption under section 

15 13(a)(1) of the Fair Labor Standards Act of 1938 (29 

16 U.S.C. 213(a)(1)) unless specific regulatory text for the 

17 provision was proposed in the proposed rule. 

Æ 


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