The U.S. Department of Labor’s (DOL’s) Wage and Hour Division (WHD) published its updated federal overtime rule. The rule, Defining and Delimiting the Exemptions for Executive, Administrative, Professional (EAP), Outside Sales and Computer Employees, was initially proposed by the WHD in September 2023.
The final rule will include an increase to the EAP salary threshold, changing from $684 per week ($35,568 annually for a full-year hourly worker) to $1,128 per week (or $58,656 annually)—a nearly 65 percent increase from the current levels that went into effect in 2020. For highly compensated employees, the new EAP salary threshold was increased from $107,432 annually to $151,164 annually. Additionally, the final rule will include a three-year automatic adjustment mechanism for updating the salary threshold.
While the rule is slated to go into effect July 1, 2024, organizations will have until Jan.1, 2025, to comply with the rule.