04/30/2024

New Overtime Rules

What employers need to know

The U.S. Department of Labor (DOL) issued a final regulation that boosts the minimum yearly salary level for qualifying for overtime pay. This rule potentially affects executive, administrative, and professional staff, sometimes referenced as the "White Collar Overtime Exemptions."

The Fair Labor Standards Act (FLSA) is the federal legislation that dictates minimum wage and overtime payment requirements for employees. According to the FLSA, non-exempt employees are entitled to overtime compensation at a rate of one and a half times their regular hourly wage for any hours worked beyond 40 in a single workweek. Although hourly employees typically qualify for overtime, salaried employees do not if they meet a specific salary threshold and have responsibilities like supervising other employees, using specialized skills or judgment, or participating in hiring and termination decisions.

Today, salaried employees earning below $35,568 annually are eligible for overtime pay for hours worked over 40 in a week. Effective July 1, 2024, if you have employees currently classified as exempt under FLSA guidelines and paid a salary, the minimum salary amount must be $43,888 ($844 per week). The next change will occur on Jan. 1, 2025, raising the minimum again to $58,656 ($1,128 per week).

Please select this link to read the complete article from Dean Dorton.