Article
Here we go again – will your business be ready for the new FLSA salary thresholds?
June 18, 2024 · Authored by Deanna Kempinski
On April 23, the Department of Labor (DOL) announced the final rule that increases the exempt salary threshold for employees under the Fair Labor Standards Act (FLSA). While the changes are likely to face legal action, employers should not take a “wait and see” approach. Employers need to make sure they are prepared to take action with impacted employees to ensure compliance.
The changes are coming quickly and employers need to be ready for not only this immediate change but also ongoing, regular updates in the coming years. Starting in July, most salaried workers earning less than $844 per week ($43,888 per year) will become eligible for overtime pay under the final rule. And on Jan. 1, 2025, most salaried workers making less than $1,128 per week ($58,656 per year) will become eligible for overtime pay. On July 1, 2027, and every three years following, the salary threshold will be increased. The total annual compensation threshold for highly compensated employees (HCEs) is also impacted by these changes.
| Effective Date | Salary Threshold | HCE Total Annual Compensation Threshold |
| Prior to July 1, 2024 | $684 per week ($35,568 per year) | $107,432 per year, including at least $684 per week paid on a salary fee basis |
| July 1, 2024 | $844 per week ($43,888 per year) | $132,964 per year, including at least $844 per week paid on a salary or fee basis |
| January 1, 2025 | $1,128 per week ($58,656 per year) | $151,164 per year, including at least $1,128 per week paid on a salary or fee basis |
| July 1, 2027, and every 3 years thereafter | To be determined by applying the methodology used to set the salary level in effect at the time of the update | To be determined by applying the methodology used to set the salary level in effect at the time of the update |
