212.627.8100On April 23, 2024, the U.S. Department of Labor (DOL) announced a final rule, Defining and Delimiting the Exemptions for Executive, Administrative, Professional, Outside Sales, and Computer Employees, which will allow millions of additional workers to be eligible for overtime pay beginning on July 1, 2024.
Overtime protections have been a critical part of federal wage laws under the Fair Labor Standards Act (FLSA) to protect workers from exploitation and ensure they are not underpaid. Most workers are entitled to overtime pay of 1.5 times their regular rate of pay for all hours worked beyond 40 hours in a workweek. Still, under the FLSA, some workers are specifically exempt from minimum wage and overtime protections. Generally, these exempt employees are those who are 1) paid on a salary basis, 2) the salary is greater than the threshold, and 3) primarily perform the duties of those defined as an “Executive,” “Administrative,” or “Professional” employee.
Under DOL’s new rule, the threshold for certain exempt salaried employees will significantly increase over the following timeline:
|
DATE |
STANDARD SALARY LEVEL |
HIGHLY COMPENSATED |
| Before July 1, 2024 | $684 per week (equivalent to $35,568 per year) | $107,432 per year, including at least $684 per week paid on a salary or fee basis |
| Starting July 1, 2024 | $844 per week (equivalent to $43,888 per year) | $132,964 per year, including at least $844 per week paid on a salary or fee basis |
| Starting January 1, 2025 | $1,128 per week (equivalent to $58,656 per year) | $151,164 per year, including at least $1,218 per week paid on a salary or fee basis |
| Starting July 1, 2027, and every 3 years thereafter | To be determined | To be determined |
Under the FLSA, “Executive” employees are generally those whose primary duty consists of managing a department or subdivision of the business, regularly directing the work of 2 or more employees, having the authority to hire, fire, or make recommendations about employees, and regularly exercises discretionary powers in the business.
“Administrative” employees are generally those whose primary duty consists of performing office or non-manual work directly related to management policies or the business’ general operations, consistently exercising discretion and judgment, and directly assisting the employer or an employee in an executive or administrative capacity, or performs specialized or technical work requiring special training, experience, or knowledge.
“Professional” employees are generally those whose primary duty consists of performing work that requires advanced knowledge in a field or science or learning customarily acquired by a prolonged course of specialized intellectual instruction and study, and further, consistently exercises discretion and judgment.
The Fair Labor Standards Act sets the minimum standard; states may exceed those wage standards and protections.
If you believe your rights under the FLSA have been violated and you are not properly receiving overtime pay, please contact a Levy Ratner attorney here.