Federal Salary Threshold for Exempt Employees Will Increase Starting July 1, 2024
In April 2024, the US Department of Labor (DOL) issued a final rule that will increase, in stages, the minimum salary required for employees to be exempt from federal minimum wage and overtime requirements. The new thresholds are scheduled to go into effect starting July 1, 2024, although business groups may seek court orders to delay or block implementation of the final rule.
For administrative, executive, and professional employees, the minimum salary for exempt status will increase from $684 per week to $844 per week ($43,888 per year) as of on July 1, 2024, and will increase to $1,128 per week ($58,656 per year) as of January 1, 2025.
For highly compensated employees, the minimum salary for exempt status will increase from $107,432 per year to $132,964 per year as of July 1, 2024, and will increase to $151,164 per year as of January 1, 2025.
Starting July 1, 2027, the DOL will use wage data to revise the minimum salary levels administrative, executive, professional, and highly compensated employees every three years.
Employers in New York State should note that the State’s salary threshold for administrative and executive employee exemptions is higher than the federal threshold. To be exempt, administrative and executive employees must earn at least $1200 per week in New York City, Long Island and Westchester County, and $1124.20 in the rest of New York State. Employees in New York State earning less than those amounts must be paid overtime, regardless of the federal law. New York does not have a salary threshold for the professional employee exemption, so employers must comply with federal law and pay minimum wage and overtime to professional employees earning less than the federal salary threshold. New York State does not have an exemption category for highly compensated employees.
