The U.S. Department of Labor recently announced a significant update to the Fair Labor Standards Act regarding overtime pay eligibility.
Starting July 1, the minimum annual salary exemption threshold from overtime pay will increase from $35,568 to $43,888 per year. This change aims to allow overtime pay eligibility to a broader scope of U.S. workers, affecting millions across the nation.
Furthermore, this adjustment will be implemented in two stages, with the threshold increasing to $58,656 on January 1, 2025. These adjustments represent a substantial increase compared to previous thresholds set by the prior administrations.
It is important to note that going forward, the threshold will automatically update every three years based on current wage data. However, the Department of Labor retains the option to temporarily delay updates if changes to methodology or update mechanisms are under consideration.
Understanding the importance of compliance with these regulatory changes, we are committed to helping you manage these updates effectively. For a comprehensive review of your HR or people practices in preparation for these changes, please engage with your Human Capital Team. We are here to support you in navigating these new regulations efficiently. Contact your HoganTaylor advisor for any inquiries or further assistance.
HoganTaylor Human Capital Strategies Services
If you have any questions about this content, or if you would like more information about HoganTaylor’s Advisory practice, please contact Jeff Wilkie, Principal and lead of the HoganTaylor Human Capital Strategies (HCS) practice. More information is also available on the Human Capital Strategies page of this website.
INFORMATIONAL PURPOSE ONLY. This content is for informational purposes only. This content does not constitute professional advice and should not be relied upon by you or any third party, including to operate or promote your business, secure financing or capital in any form, obtain any regulatory or governmental approvals, or otherwise be used in connection with procuring services or other benefits from any entity. Before making any decision or taking any action, you should consult with professional advisors.
