text: SECTION 1. SHORT TITLE.
  
      This Act may be cited as the ``Overtime Reform and Review Act''.
  
  SEC. 2. INCREMENTAL INCREASES TO SALARY THRESHOLD.
  
      (a) In General.--Section 13 of the Fair Labor Standards Act of 1938 
  (29 U.S.C. 213) is amended--
              (1) in subsection (a)(1), by inserting ``subsection (k) 
          and'' after ``subject to''; and
              (2) by adding at the end the following:
      ``(k) Requirements for Salary Threshold.--
              ``(1) In general.--In promulgating regulations for purposes 
          of defining and delimiting the terms defining employees exempt 
          under subsection (a)(1), the Secretary shall require that any 
          employee exempt under such subsection is compensated at a rate 
          that is not less than the applicable salary threshold 
          established under paragraph (2).
              ``(2) Incremental increases.--
                      ``(A) Initial threshold.--The Secretary shall 
                  establish an applicable salary threshold, beginning on 
                  December 1, 2016, that is a rate of compensation equal 
                  to $35,984 per year, or $692 per week.
                      ``(B) Subsequent increases.--Notwithstanding 
                  subparagraph (A) and subject to paragraph (3), the 
                  applicable salary threshold established under 
                  subparagraph (A) may be increased to a rate of 
                  compensation that is equal to--
                              ``(i) beginning on December 1, 2018, 
                          $39,780 per year or $765 per week;
                              ``(ii) beginning on December 1, 2019, 
                          $43,628 per year or $839 per week;
                              ``(iii) beginning on December 1, 2020, 
                          $47,476 per year or $913 per week; and
                              ``(iv) beginning on December 1, 2021, any 
                          rate of compensation provided by the Secretary 
                          in accordance with paragraph (4) and subsection 
                          (l).
              ``(3) Requirements for increases.--With respect to 
          nonprofit organizations (including nonprofit institutions of 
          higher education), Medicare or Medicaid dependent health care 
          providers, and State and local governments, the increases 
          provided in clauses (i), (ii), and (iii) of paragraph (2)(B) 
          shall occur only if--
                      ``(A) the Comptroller General of the United States 
                  conducts and submits the study under section 3 of the 
                  Overtime Reform and Review Act in accordance with that 
                  section; and
                      ``(B) not later than June 1, 2018, the Comptroller 
                  General, in coordination with the Secretary and the 
                  Chief Counsel for Advocacy of the Small Business 
                  Administration, certifies that the increase in the 
                  salary threshold under paragraph (2)(A) from the salary 
                  threshold in effect prior to December 1, 2016, has 
                  not--
                              ``(i) resulted in an increased rate of 
                          part-time employment; or
                              ``(ii) negatively impacted workplace 
                          flexibility, benefit structures, career 
                          advancement opportunity, or job growth.
              ``(4) Salary threshold after december 1, 2021.--Not prior 
          to December 1, 2021, the Secretary may issue a rule through 
          notice and comment rulemaking in accordance with section 553 of 
          title 5, United States Code, to change the rate of compensation 
          for the applicable salary threshold under paragraph (2).
              ``(5) Rule of construction.--Nothing in this subsection 
          shall require the Secretary to promulgate the regulations 
          described in this subsection in accordance with the formal 
          rulemaking provisions of sections 556 and 557 of title 5, 
          United States Code.''.
      (b) Definitions.--Section 3 of the Fair Labor Standards Act of 1938 
  (29 U.S.C. 203) is amended by adding at the end the following:
      ``(z) `Medicare or Medicaid dependent health care provider' means 
  an employer who derives more than 50 percent of its revenue from 
  payments under the Medicare program established under title XVIII of 
  the Social Security Act (42 U.S.C. 1395 et seq.), a State plan under 
  the Medicaid program under title XIX of such Act (42 U.S.C. 1396 et 
  seq.), or both.''.
      (c) Effective Date.--This section, and the amendments made by this 
  section, shall take effect on December 1, 2016.
  
  SEC. 3. GAO STUDY.
  
      (a) In General.--Not later than March 1, 2018, the Comptroller 
  General of the United States shall conduct, and submit in accordance 
  with subsection (c), a study on the implementation of the salary 
  threshold provided under section 13(k)(2)(A) of the Fair Labor 
  Standards Act of 1938 (29 U.S.C. 213(k)(2)(A)).
      (b) Contents.--The study under this section shall include each of 
  the following:
              (1) The number of small entities affected by the increase 
          in the salary threshold provided under section 13(k)(2)(A) of 
          the Fair Labor Standards Act of 1938 compared to the salary 
          threshold in effect prior to December 1, 2016.
              (2) An analysis of the impact of such increase based on 
          regional, State, metropolitan, and nonmetropolitan salary data 
          and cost-of-living differences.
              (3) The percentile of full-time salaried workers affected 
          by such increase, including disaggregation by--
                      (A) State;
                      (B) industry subsector;
                      (C) small organizations;
                      (D) small government jurisdictions;
                      (E) nonprofit organizations;
                      (F) institutions of higher education as defined in 
                  section 101 of the Higher Education Act of 1965 (20 
                  U.S.C. 1001);
                      (G) Medicare or Medicaid dependent health care 
                  providers, as defined in section 3 of the Fair Labor 
                  Standards Act of 1938 (29 U.S.C. 203); and
                      (H) small businesses.
              (4) Management and human resource costs for all employers 
          in implementing such increase.
              (5) The impact of the increase on lower-wage industries, 
          including by geographic area.
              (6) All nonfinancial costs associated with the increase, 
          including the impact on employment (including rates of 
          unemployment and part-time employment), workplace flexibility, 
          employee benefit structures, career advancement opportunity, 
          new business formation and termination, and loss of market 
          share to foreign competition.
              (7) The impact of the increase on the number of individuals 
          in the United States who are ``marginally attached'' or 
          ``discouraged'' as defined by the Bureau of Labor Statistics.
      (c) Submission.--The study under this section shall be submitted to 
  the Committee on Health, Education, Labor, and Pensions of the Senate, 
  the Committee on Education and the Workforce of the House of 
  Representatives, the Committee on Small Business and Entrepreneurship 
  of the Senate, and the Committee on Small Business of the House of 
  Representatives.
  
  SEC. 4. ENFORCEMENT OF DEPARTMENT OF LABOR RULE.
  
      (a) In General.--Beginning on the date of enactment of this Act, or 
  December 1, 2016, whichever date is earlier--
              (1) the rule submitted by the Department of Labor entitled 
          ``Defining and Delimiting the Exemptions for Executive, 
          Administrative, Professional, Outside Sales and Computer 
          Employees'' (81 Fed. Reg. 32391 (May 23, 2016)) shall cease to 
          have any force or effect;
              (2) the Secretary of Labor shall not enforce such rule 
          based on conduct occurring before or after such date;
              (3) an employee shall not have any right of action against 
          an employer for the employer's failure to comply with such rule 
          at any time prior to or after such date; and
              (4) any regulations that were amended by such rule shall be 
          restored and revived as if such rule had never taken effect.
      (b) Clarification.--Notwithstanding subsection (a), nothing in this 
  Act shall be construed to create a right of action for an employer 
  against an employee for the recoupment of any payments made to the 
  employee prior to the date of enactment of this Act, or December 1, 
  2016, whichever date is earlier, that were in compliance with the rule 
  described in subsection (a)(1).
  
  SEC. 5. FAIR LABOR STANDARDS ACT OF 1938 CLARIFICATION.
  
      (a) Sense of the Senate.--It is the sense of the Senate that 
  section 13(a)(1) of the Fair Labor Standards Act of 1938 (29 U.S.C. 
  213(a)(1)), including as in effect on the day before the date of 
  enactment of this Act--
              (1) requires the Secretary of Labor to issue a new rule 
          through notice and comment rulemaking in accordance with 
          section 553 of title 5, United States Code, for each specific 
          and enumerated change to the salary threshold provided in 
          regulations promulgated under such section 13(a)(1), proposed 
          by the Secretary of Labor; and
              (2) prohibits any rule that would result in a change to the 
          salary threshold for which a specific and enumerated rate of 
          compensation for the salary threshold was not proposed, 
          including any procedure that automatically updates the salary 
          threshold.
      (b) FLSA Amendment.--Section 13 of the Fair Labor Standards Act of 
  1938 (29 U.S.C. 213), as amended by section 2, is further amended--
              (1) in subsection (a)(1), by inserting ``in accordance with 
          subsection (l)'' after ``regulations of the Secretary''; and
              (2) by adding at the end the following:
      ``(l) Requirements for Updating the Salary Threshold.--
              ``(1) In general.--For any change to the salary threshold 
          provided in regulations promulgated under subsection (a)(1), 
          the Secretary shall--
                      ``(A) propose a specific and enumerated rate of 
                  compensation required for an employee to be exempt 
                  under such subsection; and
                      ``(B) issue a rule through notice and comment 
                  rulemaking in accordance with section 553 of title 5, 
                  United States Code.
              ``(2) Prohibition on automatic updates.--In accordance with 
          paragraph (1), the Secretary may not issue any rule that would 
          result in a change to the salary threshold provided in 
          regulations promulgated under subsection (a)(1) based on any 
          procedure that automatically updates the salary threshold 
          without taking each action required under paragraph (1).''.
target: Overtime Reform and Review Act This bill amends the Fair Labor Standards Act of 1938 (FLSA) with respect to exemptions from minimum wage and maximum hour requirements for executive, administrative, professional and outside sales employees to increase over a five-year period the salary threshold for such exemptions, beginning on December 1, 2016, with a subsequent increase on December 1, 2018, and each December 1 through 2021. The Government Accountability Office shall conduct, and submit to Congress, a study of the implementation of the 2016 initial salary threshold. The rule submitted by the Department of Labor entitled &quot;Defining and Delimiting the Exemptions for Executive, Administrative, Professional, Outside Sales and Computer Employees&quot; shall cease to have any force or effect.  This bill amends the FLSA, with respect to requirements for updating the salary threshold, to direct Labor, for any change to the salary threshold, to: (1) propose a specific and enumerated rate of compensation required for an employee to be exempt from minimum wage and maximum hour requirements, and (2) issue a rule through notice and comment rulemaking.
feat_title: Overtime Reform and Review Act