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USDOL moves to rescind “special salary level” for American Samoa

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Pago Pago, AMERICAN SAMOA — The US Department of Labor has moved to rescind a 2016 final rule - after it was challenged in federal court - which called for a drastic $400 a week hike in the “special salary level” for salary workers — who are considered exempt ‘white collar’ employees in American Samoa.

Under the 2016 final rule, the minimum guaranteed salary level for ‘exempt’ staff in American Samoa would increase from $380 per week to $767 per week effective Dec. 1, 2016.

The Lolo Administration at the time had serious concerns on the “special salary level” hike for American Samoa, because of its impact on local revenues, when it comes to supervisors and management level employees. Some in the private sector were also concerned .

The 2016 final rule, which had a much higher salary level - increasing to $913 a week - for the states resulted in a lawsuit filed that year at a federal court in Texas, which issued a order in 2017 barring the US Department of Labor (USDOL) from enforcing it.

While litigation is now on appeal, the USDOL this week moved to rescind its 2016 final rule and proposed new levels, which the federal government argued will address the court’s concerns.

The 219-page new proposal made public this week by USDOL will update and revise regulations issued under the Fair Labor Standards Act (FLSA), implementing the exemption from minimum wage and overtime pay requirements for executive, administrative, professional, outside sales, and computer employees.

The document provides provisions outlining the proposed “special salary level” for Puerto Rico, the US Virgin Islands, Guam, and the Commonwealth of the Northern Mariana Islands to $455 per week.

Another provision of the proposal is specific for American Samoa, with a “separate special salary level”, saying that USDOL has historically applied a special salary level test to employees in American Samoa because minimum wage rates there have remained lower than the federal minimum wage.

“The disparity with the federal minimum wage is expected to remain for the foreseeable future,” it says.  USDOL proposed to set American Samoa’s special salary level at $380 per week but it does not apply to federal workers in the territory.

“This approach not only maintains the special salary level that the Department is currently enforcing in American Samoa, but also ensures that American Samoa, which has a lower minimum wage than the other U.S. territories, does not have a higher special salary level,” it says.

USDOL is seeking public comments not only for the special salary levels for American Samoa and the other US territories, but also those set for the rest of the states.

There are 17-different minimum wage levels in American Samoa, depending on the industry.