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LRB-1867/1
MED:ahe
2017 - 2018 LEGISLATURE
March 20, 2017 - Introduced by Representatives Mason, Anderson, Berceau,
Brostoff, Fields, Genrich, Goyke, Hintz, Kolste, Ohnstad, Pope, Riemer,
Sargent, Sinicki, Spreitzer, Subeck, C. Taylor, Vruwink, Wachs, Zamarripa
and Zepnick, cosponsored by Senators Hansen, Ringhand, Carpenter,
Johnson, C. Larson, Miller, Risser, Vinehout and Wirch. Referred to
Committee on Labor.
AB154,1,8 1An Act to renumber and amend 103.02; to amend 103.03, 109.09 (1), 111.322
2(2m) (a) and 111.322 (2m) (b); and to create 103.02 (3) and 103.023 of the
3statutes; relating to: the exemption of bona fide administrative, executive,
4and professional employees from the overtime pay requirements of the wage
5and hours laws, extending the time limit for emergency rule procedures,
6providing an exemption from emergency rule procedures, providing an
7exemption from rule-making procedures, and requiring the exercise of
8rule-making authority.
Analysis by the Legislative Reference Bureau
Under current administrative rules promulgated by the Department of
Workforce Development, employers are generally required to pay employees 1.5
times their regular rates of pay for all hours worked in excess of 40 hours per week
(overtime pay). Those rules, however, exempt from the overtime pay requirement
employees whose primary duty consists of administrative, executive, or professional
work (exempt employees). Currently, those rules generally define an administrative,
executive, or professional employee, in part, as an employee who does not devote
more than 20 percent of his or her hours of work to activities that are not
administrative, executive, or professional in nature (20 percent rule) and who is

compensated on a salary basis at a rate of not less than $700 per month or, in the case
of a professional employee, $750 per month (compensation threshold).
This bill requires DWD, for purposes of defining an exempt employee, to set the
compensation threshold at $970 per week and to replace the 20 percent rule with a
requirement that employee's “primary duty" be administrative, executive, or
professional work. The bill provides that, by the first day of the 18th month
beginning after the bill's effective date, and annually thereafter, DWD must
promulgate emergency rules to revise that compensation threshold by calculating
the percentage change in the consumer price index for the 12-month period ending
on the last day of the last month for which that information is available and adjusting
the rate then in effect by that percentage difference.
For further information see the state and local fiscal estimate, which will be
printed as an appendix to this bill.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
AB154,1 1Section 1. 103.02 of the statutes is renumbered 103.02 (1) and amended to
2read:
AB154,2,63 103.02 (1) No person may be employed or be permitted to work in any place of
4employment or at any employment for such any period of time during any day, night,
5or week, as that is dangerous or prejudicial to the person's life, health, safety, or
6welfare.
AB154,3,4 7(2) The department shall investigate, ascertain, determine, and fix such
8reasonable classification, classifications, issue general or special orders, and
9promulgate rules fixing a period of time, or hours of beginning and ending work
10during any day, night, or week, which shall that may be necessary to protect the life,
11health, safety, or welfare of any person, or to carry out the purposes of ss. 103.01 to
12103.03. The department shall, by rule, classify such periods of time into periods to
13be paid for at regular rates and periods to be paid for at the rate of at least one and
14one-half
1.5 times the regular rates. Such investigations, classifications, rules, and
15orders shall be made as provided in s. 103.005 and the penalties under s. 103.005 (12)

1shall apply to and be imposed for any violation of ss. 103.01 to 103.03
. Such orders
2shall be subject to review in the manner provided in ch. 227. Section 111.322 (2m)
3applies to discharge or other discriminatory acts arising in connection with any
4proceeding under this section.
AB154,2 5Section 2. 103.02 (3) of the statutes is created to read:
AB154,3,86 103.02 (3) The employment of any person in any employment or place of
7employment at any time other than the permissible hours of labor under this section
8shall be prima facie evidence of a violation of this section.
AB154,3 9Section 3. 103.023 of the statutes is created to read:
AB154,3,11 10103.023 Hours of labor; exempt employees. (1) Definitions. In this
11section:
AB154,3,1412 (a) “Compensated on a salary basis" means to receive regularly each pay period
13a predetermined amount constituting all or part of the employee's compensation,
14which amount is not subject to reduction because of any of the following:
AB154,3,1515 1. Variations in the quality or quantity of the work performed.
AB154,3,1716 2. Absences from work occasioned by the employer or by the operating
17requirements of the employer's business.
AB154,3,1918 3. The fact that work is not available, so long as the employee is ready, willing,
19and able to work.
AB154,4,220 (b) “Employee employed in a bona fide administrative capacity" means an
21employee who is compensated on a salary basis at a rate of not less than the rate
22determined under sub. (3), exclusive of board, lodging, or other facilities, whose
23primary duty is the performance of office or nonmanual work directly related to the
24management or general business operations of the employer or of the employer's

1customers, and whose primary duty includes the exercise of discretion and
2independent judgment with respect to matters of significance.
AB154,4,143 (c) “Employee employed in a bona fide executive capacity" means an employee
4who is compensated on a salary basis at a rate of not less than the rate determined
5under sub. (3), exclusive of board, lodging, or other facilities, whose primary duty is
6management of the enterprise in which he or she is employed or a department or
7subdivision of that enterprise, who customarily and regularly directs the work of two
8or more other employees, and who has the authority to hire and fire other employees
9or whose suggestions and recommendations as to the hiring, firing, advancement,
10promotion, or any other change in status of other employees are given particular
11weight. In this paragraph, “customarily and regularly directs" means to direct with
12a frequency that is greater than occasional, but not necessarily constant, including
13direction that is normally and recurrently performed every work week, but not
14including isolated or one-time direction.
AB154,4,2115 (d) “Employee employed in a bona fide professional capacity" means an
16employee who is compensated on a salary or fee basis at a rate of not less than the
17rate determined under sub. (3), exclusive of board, lodging, or other facilities and
18whose primary duty is the performance of work requiring knowledge of an advanced
19type in a field of science or learning customarily acquired by a prolonged course of
20specialized intellectual instruction or requiring invention, imagination, originality,
21or talent in a recognized field of artistic or creative endeavor.
AB154,4,2322 (e) “Exempt employee" means an employee employed in a bona fide
23administrative, executive, or professional capacity.
AB154,5,224 (f) “Primary duty" means the principal, main, major, or most important duty
25that an employee performs as determined on the basis of all the factors in a particular

1case, with the major emphasis on the character of the employee's job as a whole,
2including all of the following factors:
AB154,5,43 1. The relative importance of the employee's duties as an exempt employee as
4compared to other types of duties.
AB154,5,65 2. The amount of time spent by the employee performing the duties of an
6exempt employee.
AB154,5,77 3. The employee's relative freedom from direct supervision.
AB154,5,108 4. The relationship between the employee's salary and the wages paid to other
9employees for the kind of work, other than the work of an exempt employee,
10performed by the employee.
AB154,5,15 11(2) Exempt employees. In promulgating rules under s. 103.02 (2) classifying
12periods of time into periods to be paid for at regular rates and periods to be paid for
13at a rate of at least 1.5 times the regular rates, the department shall exempt from
14the application of those rules employees employed in a bona fide administrative,
15executive, or professional capacity.
AB154,6,2 16(3) Pay rate determination. (a) For the purpose of sub. (1) (b), (c), and (d), the
17rate of compensation shall be $970 per week until the first day of the 18th month
18beginning after the effective date of this paragraph .... [LRB inserts date]. By the
19first day of the 18th month beginning after the effective date of this paragraph ....
20[LRB inserts date], and annually thereafter, the department shall, subject to par. (c),
21promulgate rules to revise that rate. The department shall revise the rate of
22compensation by calculating the percentage difference between the consumer price
23index for the 12-month period ending on the last day of the last month for which that
24information is available and the consumer price index for the 12-month period
25ending on the last day of the month 12 months prior to that month, adjusting the rate

1then in effect by that percentage difference, and rounding that result to the nearest
2multiple of 5 cents.
AB154,6,103 (b) The department may use the emergency rule procedures under s. 227.24 to
4promulgate the rules required under par. (a). Notwithstanding s. 227.24 (1) (a) and
5(3), the department may promulgate those rules as emergency rules without
6providing evidence that promulgating those rules as emergency rules is necessary
7to preserve the public peace, health, safety, or welfare and without a finding of
8emergency. Notwithstanding s. 227.24 (1) (e) 1d. and 1g., the department is not
9required to prepare a statement of the scope of those rules or to submit those rules
10in final draft form to the governor for approval.
AB154,6,1411 (c) Paragraph (a) does not apply if the consumer price index for the 12-month
12period ending on the last day of the last month for which that information is available
13has not increased over the consumer price index for the 12-month period ending on
14the last day of the month 12 months prior to that month.
AB154,4 15Section 4. 103.03 of the statutes is amended to read:
AB154,6,25 16103.03 Violations; penalty. The employment of any person in any
17employment or place of employment at any time other than the permissible hours of
18labor shall be prima facie evidence of a violation of this section
Any employer that
19violates s. 103.02 or 103.023 is subject to the penalties under s. 103.005 (12)
. Every
20day for each person employed, and every week for each person employed, during
21which any employer fails to observe or to comply with any order of the department,
22or to perform any duty enjoined by ss. 103.01 to 103.03 required by s. 103.02 or
23103.023
, shall constitute a separate offense. Section 111.322 (2m) applies to
24discharge or other discriminatory acts arising in connection with any proceeding
25under s. 103.02 or 103.023.
AB154,5
1Section 5. 109.09 (1) of the statutes is amended to read:
AB154,7,232 109.09 (1) The department shall investigate and attempt equitably to adjust
3controversies between employers and employees as to alleged wage claims. The
4department may receive and investigate any wage claim that is filed with the
5department, or received by the department under s. 109.10 (4), no later than 2 years
6after the date the wages are due. The department may, after receiving a wage claim,
7investigate any wages due from the employer against whom the claim is filed to any
8employee during the period commencing 2 years before the date the claim is filed.
9The department shall enforce this chapter and s. 66.0903, 2013 stats., s. 103.49, 2013
10stats., and s. 229.8275, 2013 stats., and ss. 16.856, 103.02, 103.023, 103.82, and
11104.12. In pursuance of this duty, the department may sue the employer on behalf
12of the employee to collect any wage claim or wage deficiency and ss. 109.03 (6) and
13109.11 (2) and (3) shall apply to such actions. Except for actions under s. 109.10, the
14department may refer such an action to the district attorney of the county in which
15the violation occurs for prosecution and collection and the district attorney shall
16commence an action in the circuit court having appropriate jurisdiction. Any
17number of wage claims or wage deficiencies against the same employer may be joined
18in a single proceeding, but the court may order separate trials or hearings. In actions
19that are referred to a district attorney under this subsection, any taxable costs
20recovered by the district attorney shall be paid into the general fund of the county
21in which the violation occurs and used by that county to meet its financial
22responsibility under s. 978.13 (2) (b) for the operation of the office of the district
23attorney who prosecuted the action.
AB154,6 24Section 6. 111.322 (2m) (a) of the statutes is amended to read:
AB154,8,4
1111.322 (2m) (a) The individual files a complaint or attempts to enforce any
2right under s. 103.02, 103.023, 103.10, 103.11, 103.13, 103.28, 103.32, 103.34,
3103.455, 104.12, 109.03, 109.07, 109.075, 146.997, or 995.55, or ss. 101.58 to 101.599
4or 103.64 to 103.82.
AB154,7 5Section 7. 111.322 (2m) (b) of the statutes is amended to read:
AB154,8,96 111.322 (2m) (b) The individual testifies or assists in any action or proceeding
7held under or to enforce any right under s. 103.02, 103.023, 103.10, 103.11, 103.13,
8103.28, 103.32, 103.34, 103.455, 104.12, 109.03, 109.07, 109.075, 146.997, or 995.55,
9or ss. 101.58 to 101.599 or 103.64 to 103.82.
AB154,8 10Section 8. Initial applicability.
AB154,8,1411 (1) Exempt employees. This act first applies to an employee who is affected by
12a collective bargaining agreement that contains provisions inconsistent with this act
13on the day on which the collective bargaining agreement expires or is extended,
14modified, or renewed, whichever occurs first.
AB154,8,1515 (End)
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