Employer Alert: DOL Announces Final Rule Defining Exemptions for White-Collar Employees 

April 26, 2024

On April 23 2024, the U.S. Department of Labor (“DOL”) announced a final rule which will take effect on July 1, 2024. The final rule updates and revises the regulations issued under section 13(a)(1) of the Fair Labor Standards Act (“FLSA”) by implementing the exemptions from the minimum wage and overtime pay requirements for executive, administrative, professional, outside sales, and computer employees (often referred to as the “white-collar” exemption). 

The final rule increases the threshold salary level white collar and highly compensated employees must be paid to maintain their exempt status.  

On January 1, 2025, the DOL will release changes in the methodologies used to calculate these levels and will require another significant increase to the aforementioned salary thresholds. 

To whom does this change apply? 

Employees are exempt from the FLSA’s minimum wage and overtime protections if they are employed in a bona fide executive, administrative, or professional capacity, pursuant to 29 C.F.R. part 541. To fall within the exemption, an employee must meet three tests:  

1. be paid a salary, of a predetermined and fixed amount that is not subject to reduction because of variations in the quality or quantity of work performed; 

2. be paid at least a specified weekly salary level; and  

3. primarily perform executive, administrative, or professional duties.  

When will the standard salary level changes take effect?