Final Rules of FLSA & Exemptions
The Department of Labor (DOL) issued the highly anticipated final rule to expand overtime protections on April 23, 2024. The updated salary thresholds for executive, administrative, and professional exemptions for overtime pay under the FLSA require the following:
- Beginning July 1, 2024, increase the salary threshold for overtime exemptions from $35,568 annually to $43,888 annually. This salary threshold will increase to $58,656 annually on January 1, 2025. This increase reflects the 35th percentile of weekly earnings of full-time salaried workers in the lowest-wage census region (currently the South).
- Beginning July 1, 2024, increase the salary threshold for highly compensated employees from $107,432 annually to $132,964. This salary threshold will increase to $151,164 annually on January 1, 2025. The increase reflects the earnings of the 85th percentile of full-time salaried workers nationally.
- Beginning July 1, 2027, implement automatic increases every three years for all salary thresholds.
These substantial increases in the salary thresholds will require employers to assess their current workforce and make decisions regarding how to handle employees whose salaries fall between the current and updated salary thresholds. The first consideration will be whether implementation may be delayed by litigation. Based on the new rule and assuming it withstands legal scrutiny, employers will need to weigh the option of increasing salaries to meet the new threshold or converting employees to nonexempt status, which would make them eligible for overtime pay. Beyond the financial considerations, employers should also anticipate nonmonetary impacts on affected employees, such as changes to morale, timekeeping procedures, and potential compression issues within the organization’s salary structure.
Given the potential complexities and implications of these proposed changes, this seminar will provide employers with guidance to understand the requirements, assess the impact on the organization, and develop strategies for compliance with the FLSA. By proactively preparing for the implementation of the proposed overtime rule, employers can mitigate risks, maintain compliance, and support a smooth transition for both the organization and its employees.
This virtual meeting is free for STXCABA members and open to guests for just $25. Thank you! We are venturing into a more Total Rewards approach and hope you all share this event with other Total Rewards professionals.
Speaker:
Lea Ream, Attorney, Davidson Troilo Ream and Garza
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Lea Ream has practiced law for over thirty years in San Antonio at the law firm of Davidson Troilo Ream and Garza. Lea’s practice centers on a broad spectrum of human resource management issues that employers face every day in business. She assists clients in complying with the vast, ever-changing array of state and federal laws and regulations governing their relationships with employees. She started her career litigating cases but spends most of her time helping employers avoid claims and lawsuits, or at least being prepared if her clients have to defend against such matters. She provides guidance to management in matters involving discrimination, harassment and retaliation relating to sex, race, ethnicity, age, religion and health matters; breach of contract; covenants not to compete; among others.
This event is anticipated for HRCI & SHRM certification. We hope to see you there.
