Overtime Pay

Court Invalidates DOL Overtime Rule Nationwide

On November 15, 2024, the US District Court for the Eastern District of Texas retroactively invalidated a Final Rule from the Department of Labor (DOL) that had increased the minimum salary threshold for certain employees to be considered exempt from overtime pay under the Fair Labor Standards Act (FLSA). The rule was originally effective on July 1, 2024. This decision affects all employers nationwide.

The final rule provided staged increases to the standard salary level necessary for exemption from overtime pay for executive, administrative, and professional (EAP) employees. The first increase occurred July 1, 2024, raising the minimum salary level for EAP employees from $684 per week to $844 per week. The second increase was scheduled to occur on January 1, 2025 with an additional increase to $1,128 per week. The rule also created an automatic adjustment occurring on July 1, 2027 and then every three years thereafter.

What does invalidating the rule mean?

The scheduled increases to the minimum salary level for EAP employees to remain exempt from overtime did not, and will not, occur. The minimum salary level in effect prior to July 1, 2024 ($684 per week) is once again effective.