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PrintOn April 23, the U.S. Department of Labor (DOL) announced a final rule to increase the minimum salary level for the Fair Labor Standards Act "white collar" exemptions in two steps:
- On July 1, the minimum salary level increases from $684 to $844 per week (or from $35,568 per year to $43,888 per year).
- On January 1, 2025, the minimum salary level increases from $844 to $1,128 per week (or from $43,888 per year to $58,656 per year).
The final rule also requires the salary level be updated every 3 years to match the 35th percentile of weekly earnings of full-time salaried workers in the lowest-wage Census Region. This means that on July 1, 2027, and every 3 years after, the salary level will be updated.
The final rule is scheduled for publication in the Federal Register on April 26.
HCE salary requirements increase
The final rule increases the salary requirement for highly compensated employees (HCEs) from $107,432 to $132,964 per year on July 1, then from $132,964 to $151,164 per year on January 1, 2025. The HCE level also will be adjusted every 3 years at the same time as the salary threshold.
Items that did not change
The DOL pointed out a few items were not adopted in the final rule, although they were in the notice of proposed rulemaking (NPRM). These items from the NPRM are not part of the final rule: applying the standard salary level to the U.S. territories subject to the federal minimum wage (Commonwealth of the Northern Mariana Islands, Guam, Puerto Rico, and the Virgin Islands) and updating the special salary levels for American Samoa and the motion picture industry.