The Department of Labor recently released a final ruling under the Fair Labor Standards Act (FLSA) that increases the current salary threshold minimum and highly compensated threshold amounts.
The FLSA defines the exempt and non-exempt classifications, minimum wage requirements, and overtime rules.
As of the new ruling, the salary threshold minimum and highly compensated employee exemption will increase to the following thresholds per this newly defined schedule:
What to Expect: Passage of this proposal will require employers to take action (i.e., determine if they need to make any adjustments to incumbent employee wages, or job classification) for any employees classified as exempt and not earning the new required salary minimum threshold amount or highly compensated employee threshold requirements.
When: The final ruling is slated to go into effect July 1, 2024.
One Caveat: As we have seen with previous attempts from the Department of Labor to update the standards, there will likely be attempts to stop and/or change the amounts listed in the final ruling. Although it is recommended that employers start preparing for these changes as if they will take effect, we advise to hold off on implementing any changes before July 1, 2024, until all legal action against the ruling has been finalized.
Ensure Peace of Mind: This DOL ruling is a good reminder of the importance and impact of FLSA requirements and compliant job analysis and job classification practices.
If you have not performed an FLSA Audit recently or are unfamiliar with FLSA compliance, please reach out. Rehmann has a team of HR Business Advisors that can help you avoid risk, ensure your employees’ jobs are appropriately classified, and prepare you for a DOL audit — should one arise. Please reach out to your Rehmann Business Advisor to discuss.