On April 23, 2024, the federal Department of Labor (“DOL”) issued its final rule on the salary threshold for the executive, administrative, and professional exemptions under the Fair Labor Standards Act.  The rule provides for increases in minimum salary required for these types of employees to qualify as exempt from overtime pay requirements under federal law.  Under the rule, the minimum salary threshold will increase to $43,888 effective July 1, 2024.  Then, on January 1, 2025, the minimum salary threshold will further increase to $58,656.

Additionally, the final rule increases the salary requirement for the highly compensated employee “catchall” exemption.  That amount will increase on July 1, 2024 to $132,964, and again on January 1, 2025 to $151,164.

Employer groups will undoubtably file lawsuits challenging and seeking to enjoin this rule, and we will monitor those challenges.  However, employers should take steps to prepare for compliance, which may mean increasing the salaries of employees who will remain exempt or reclassifying their positions to hourly, non-exempt (and, in turn, tracking hours and paying overtime where applicable).  Employers are reminded that many states have their own salary thresholds for overtime exempt status and in some instances (notably in California), the salary threshold is higher than federal law.  Employers with exempt employees in those states must comply with the higher of the applicable salary thresholds in order to be in compliance.  

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Photo of Robin E. Largent Robin E. Largent

Robin Largent has been advising and defending employers for over twenty years, primarily in California state and federal courts.  Robin’s practice focuses on the defense of wage and hour class and representative (PAGA) actions.  Robin’s practice also focuses heavily on compliance and advice…

Robin Largent has been advising and defending employers for over twenty years, primarily in California state and federal courts.  Robin’s practice focuses on the defense of wage and hour class and representative (PAGA) actions.  Robin’s practice also focuses heavily on compliance and advice on best practices to prevent and mitigate the risks of employment litigation.  Robin also regularly defends employers ranging from small, locally owned businesses to large national corporations in single plaintiff employment litigation involving claims for discrimination, harassment, retaliation, breach of contract, and wrongful termination.  Robin has substantial appellate experience and success handling appeals, writ petitions, and amicus briefs in both state and federal courts on issues such as class certification (particularly in the wage and hour arena), manageability and due process concerns associated with class action trials, novel issues of interpretation of wage and hour laws, exempt/non-exempt misclassification issues, meal and rest break compliance, trade secret/unfair competition matters, and the scope of federal court jurisdiction under the Class Action Fairness Act.  Finally, Robin is well-known for her former role as Editor and primary author of the California Labor and Employment Law Blog for close to a decade.