The U.S. Department of Labor (DOL) has issued a technical amendment formally restoring the 2019 overtime salary thresholds in the Code of Federal Regulations (CFR) after two federal court decisions invalidated the 2024 overtime rule.
For employers, HR professionals, and payroll teams, this update confirms which federal salary thresholds currently govern overtime exemption classifications under the Fair Labor Standards Act (FLSA).
To qualify for an overtime exemption under the FLSA, employees generally must satisfy three requirements:
- Duties test
- Salary basis test
- Salary level test
In 2019, the DOL increased the federal minimum salary threshold for exempt employees from $455 per week to $684 per week ($35,568 annually).
That threshold remained in effect until July 2024, when a new rule increased the salary level to $844 per week, with a second increase to $1,128 per week ($58,656 annually) scheduled for January 2025.
However, the second increase never took effect.
In late 2024, federal courts in Texas vacated the 2024 rule. Following those decisions, the Wage and Hour Division (WHD) immediately returned to enforcing the 2019 thresholds.
The DOL has now formally removed the vacated rule language from the CFR and restored the 2019 rule language to eliminate confusion regarding current compliance obligations.
Current Federal Overtime Salary Thresholds
The current federal salary thresholds are:
- Standard salary threshold: $684 per week ($35,568 annually)
- Highly compensated employee (HCE) threshold: $107,432 annually, including at least $684 per week paid on a salary basis
- Territory-specific thresholds:
- Guam, Puerto Rico, U.S. Virgin Islands, and Northern Mariana Islands: $455 per week
- American Samoa: $380 per week
What HR and Payroll Teams Should Review
Organizations that made classification or compensation changes in response to the 2024 rule should review those decisions carefully.
Confirm State Law Requirements
The federal threshold is only the minimum standard. Several states, including New York, California, and Washington, have higher exempt salary thresholds that control where applicable.
Employers should confirm which state and federal requirements apply before making pay or classification decisions.
Reevaluate Exempt Classifications
Employees reclassified as non-exempt under the 2024 rule may again meet the federal salary threshold, but salary level alone does not determine exempt status.
Employers should reassess duties tests and maintain clear documentation supporting exemption decisions. Frequent classification changes without adequate documentation can increase risk in wage and hour disputes.
Review HCE Classifications
The HCE threshold has returned to $107,432 annually.
HR and payroll teams should review both compensation and duties for employees near that threshold and verify that any bonus or prorated compensation calculations comply with HCE requirements.
Be Cautious About Salary Reductions
Employers that increased salaries in response to the 2024 rule may be able to reduce pay prospectively, but those decisions should be approached carefully.
Any reduction must still satisfy the salary basis test for exempt status and may create employee relations concerns, including morale, retention, and wage complaint risks.
Update Policies and Documentation
Organizations should review and update:
- Job descriptions
- Classification analyses
- Payroll practices
- Exemption policies
- Supporting documentation
Materials revised during the 2024 rule rollout should now reflect the restored 2019 standards and current enforcement position.
Final Thoughts
Need help reviewing exempt classifications, payroll practices, or wage and hour compliance obligations? CNY HR Now provides practical HR support for small and mid-sized businesses navigating complex employment law and compliance challenges. Contact us to learn how we can help your organization stay compliant while supporting your workforce effectively.