As we previously reported, in April 2024, the U.S. Department of Labor published a final rule that would have raised the minimum salary threshold to qualify for the executive, administrative, or professional exemptions from overtime under the Fair Labor Standards Act (“FLSA”).  The final rule would also have increased the salary requirements for the highly compensated employee exemption.  The final rule has now been struck down by a federal district court.

The United States District Court for the Eastern District of Texas issued a decision blocking the increases in the minimum salary required to claim the overtime exemption for executive, administrative, and professional employees under the Fair Labor Standards Act.  The final rule proposed an initial increase on July 1, 2024, when the minimum salary for overtime exemptions would have increased to $844 (approximately $43,888 per year).  The second increase was proposed to occur on January 1, 2025, when it would be raised to $1,128 per week (approximately $58,656 per year).  Now that the final rule has been struck down, the current federal threshold of $35,568.00 per year will remain.

While the decision has a significant impact on many employers throughout the country, the rule has a lesser effect on New York State employers as the New York State salary thresholds already exceed the proposed federal threshold.  However, New York employers with employees in other states can breathe a sigh of relief for now. 

Should you have any questions, please contact Ali Law Group.

HRtelligence was created by the team at Ali Law Group, LLC.  Should you have any questions or need assistance, please contact Ali Law Group.

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