The DOL’s final overtime rule, Defining and Delimiting the Exemptions for Executive, Administrative, Professional, Outside Sales, and Computer Employees, revises the Fair Labor Standard Act’s overtime exemptions for executive, administrative, professional and highly compensated employees. Effective July 1, 2024, an executive, administrative or professional employee must receive a salary equivalent to $43,888 per year in order to be classified as exempt. This will increase to $58,656 on January 1, 2025. Meanwhile, the annual compensation threshold for the highly compensated employee exemption will increase to $132,964 on July 1, 2024, and then again to $151,164 on January 1, 2025.
These numbers are higher than what the DOL previewed in its August 2023 proposed rule. And they represent a significant jump from the current $35,568 salary level for executive, administrative, and professional employees, and the $107,432 minimum compensation level for highly compensated employees.
These significant increases will have substantial implications and impacts across industries and command employers’ attention.
