The Labor Department on Tuesday finalized its proposed rule to change the salary standards used to determine a worker’s overtime.
Effective July 1, 2024, the salary threshold will increase to the equivalent of an annual salary of $43,888 and increase to $58,656 on Jan. 1, 2025. Before the new rule, the annual salary threshold was $35,568.
Labor Department acting Secretary Julie Su said, “This rule will restore the promise to workers that, if you work more than 40 hours in a week, you should be paid more for that time. Too often, lower-paid salaried workers are doing the same job as their hourly counterparts but are spending more time away from their families for no additional pay. That is unacceptable.”
Starting July 1, 2027, salary thresholds will update every three years, by applying up-to-date wage data to determine new salary levels.
Wage and Hour Administrator Jessica Looman said, “The Department of Labor is ensuring that lower-paid salaried workers receive their hard-earned pay or get much-deserved time back with their families. This rule establishes clear, predictable guidance for employers on how to pay employees for overtime hours and provides more economic security to the millions of people working long hours without overtime pay.”
The department conducted extensive engagement with employers, workers, unions and other stakeholders before issuing its proposed rule in September 2023, and considered more than 33,000 comments in developing its final rule.
