On April 23, the U.S. Department of Labor (DOL) released a final rule relating to overtime exemptions for employees performing executive, administrative, and professional (EAP) duties under the federal Fair Labor Standards Act. The final rule completes work initiated by a notice of proposed rulemaking in September 2023, and makes the changes to current FLSA regulations, including:
- The rule increases the standard annual salary that must be paid for an individual to be classified as overtime-exempt from $35,568 to $43,888, effective July 1, 2024.
- Effective January 1, 2025, the rule further increases the standard annual salary threshold from $43,888 to $58,656.
- The rule adopts a mechanism to update the earnings thresholds every three years, beginning Jully 2027, without a notice and comment rulemaking.
LeadingAge had advocated that DOL should not implement such a significant increase in the salary threshold and should not adopt the auto-updating mechanism, but the Department did not waiver from its proposal. LeadingAge Kansas submitted comments suggesting a carveout for long-term care providers with rates directly tied to Medicare and Medicaid reimbursement, but it also was not included in the finalized rule. We are analyzing the final rule and will provide additional information soon. This DOL webpage provides an overview, along with links to the final rule and to an FAQ resource.
