DOL Announces New Salary Thresholds for Overtime Eligibility

 

The U.S. Department of Labor (DOL) has finalized a rule to significantly increase the salary thresholds for overtime eligibility under the Fair Labor Standards Act (FLSA). Effective July 1, 2024, the threshold for exempt executive, administrative, and professional employees will rise from $35,568 to $43,888 annually. This increase will expand to $58,656 on January 1, 2025. Highly compensated employees will also see their threshold raised from $107,432 to $132,964, eventually reaching $151,164.

 

Impact and Updates to Overtime Rules

 

This rule change aims to ensure that more salaried workers receive fair compensation for overtime. It will adjust every three years, starting from July 1, 2027, to keep pace with wage growth. These changes are part of broader efforts to enhance labor protections and ensure that workers are compensated fairly for longer working hours.

 

The update not only increases the salary thresholds but also sets a schedule for regular future updates, ensuring that the effectiveness of these thresholds does not diminish over time. Employers will need to either raise salaries to meet the new thresholds or pay overtime rates to workers who do not meet the criteria. This shift marks a significant policy move aimed at improving working conditions and compensation for millions of American workers.