Revised FLSA Overtime Exemption Starting July 1, 2024

Revised FLSA Overtime Exemption Starting July 1, 2024

On April 23rd, the U.S. Department of Labor (DOL) issued a rule increasing salary thresholds for exempt employees and highly compensated employees. Under the federal Fair Labor Standards Act (FLSA), employees generally must be paid overtime, unless they fall within an exemption.

What’s changing:

The FLSA overtime rules have recently been revised, increasing the salary thresholds for exempt employees effective July 1, 2024 (see schedule below). The threshold will increase again on January 1, 2025, with automatic updates to be released every three years, beginning July 1, 2027, based on applicable wage data.


  • Salary Exempt Employees: $684/week or $35,568/year
  • Highly Compensated Employees: $107,432/year

Effective July 1, 2024:

  • Salary Exempt Employees: $844week or $43,888/year
  • Highly Compensated Employees: $132,964/year

Effective January 1, 2025:

  • Salary Exempt Employees: $1,128/week or $58,656/year
  • Highly Compensated Employees: $151,164/year

ProService Partners: we got you covered! Over the next few weeks, we will reach out to you if you have any affected employees with resources and expert advice to help you navigate next steps and ensure you are in compliance by July 1. We also invite you to join our live webinar on Wednesday, May 22 at 11am to learn more.

Next Steps for Employers:

After understanding what’s changing, employers should assess how the new rule may impact their organization and take appropriate action. Here are 3 things employers should do before the new rule becomes effective:

  • Review employees’ salaries and analyze your options. Employers should Identify employees whose exemption status may be affected by the revised salary thresholds and consider next steps to stay in compliance. For ProService partners, we will identify your affected employees and provide you with resources to help you navigate your options, whether to reclassify an employee or adjust their salaries.
  • Update your time recording procedures to accurately track the hours worked by non-exempt employees. If you reclassify an employee to non-exempt, remember that you’ll need to start tracking their hours. For ProService partners, we’ll make the updates in your HR platform for you to ensure accurate time tracking and payroll moving forward.
  • Communicate the change with affected employees.  Employers must inform employees of changes to their pay before the effective date. This includes providing your overtime policies and processes to newly non-exempt employees. For ProService partners, we’ll equip you with template letters and resources to confidently communicate the changes with your team.

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