On July 1, 2024, the first phase of the U.S. Department of Labor (DOL)’s updated overtime rule went into effect, raising the minimum salary threshold for employees who are classified as “exempt” under the white-collar exemptions to the Fair Labor Standards Act (FLSA). The rule is subject to legal challenges but, as detailed below, remains in effect for now (other than for the State of Texas as a government employer).

A full summary of the rule is available here. In short, as of July 1, 2024, employees must be paid $844 per week ($43,888 annualized) to satisfy the salary threshold for the executive, administrative and professional exemptions. To satisfy the highly compensated” exemption salary threshold, employees must be compensated at least $132,964 per year (and a minimum of $844 per week). Effective January 1, 2025, the minimum salary threshold is set to increase to $1,128 per week ($58,656 annualized) for the executive, administrative, and professional exemptions, and to $151,164 per year for the highly compensated employee exemption. From there, the rule provides for updates to the minimum salary threshold every three years, starting July 1, 2027.Continue Reading Federal court challenges to DOL overtime rule yield mixed results while foretelling a merits ruling before end of year