--- title: Major Overtime Change Will Deeply Affect Employers description: Explore the significant changes to overtime regulations that will impact employers starting July 2024. Learn how the updated salary thresholds for exempt employees could affect your business and what steps you need to take to stay compliant. image: https://blog.affinityhrinc.com/hubfs/overtime%20image.png --- [Skip to content](https://blog.affinityhrinc.com/major-overtime-change-will-deeply-affect-employers#main-content) [![](https://blog.affinityhrinc.com/hs-fs/hubfs/Logo-1.png?width=1500&height=498&name=Logo-1.png)](https://affinityhrinc.com/) - [About](https://affinityhrinc.com/about) - [Services](https://affinityhrinc.com/services) - [Why Affinity?](https://affinityhrinc.com/why-affinity) - [Blog](https://blog.affinityhrinc.com/) - [Resources](https://info.affinityhrinc.com/resource-center) - [Podcast](https://info.affinityhrinc.com/breakfast-table-hr-stories) - [Portal](https://d21.darwinet.com/107D2) - [Company Directory](https://affinityhrinc.com/company-directory) Open main navigation Close main navigation - [About](https://affinityhrinc.com/about) - [Services](https://affinityhrinc.com/services) - [Why Affinity?](https://affinityhrinc.com/why-affinity) - [Blog](https://blog.affinityhrinc.com/) - [Resources](https://info.affinityhrinc.com/resource-center) - [Podcast](https://info.affinityhrinc.com/breakfast-table-hr-stories) - [Portal](https://d21.darwinet.com/107D2) - [Company Directory](https://affinityhrinc.com/company-directory) - [Contact us](https://affinityhrinc.com/contact) [Contact us](https://affinityhrinc.com/contact) Apr 23, 2024 7:30:00 AM # Major Overtime Change Will Deeply Affect Employers [Teresa McCormick](https://blog.affinityhrinc.com/author/teresa-mccormick) Share: [facebook-f icon](http://www.facebook.com/share.php?u=https://blog.affinityhrinc.com/major-overtime-change-will-deeply-affect-employers) [linkedin-in icon](http://www.linkedin.com/shareArticle?mini=true&url=https://blog.affinityhrinc.com/major-overtime-change-will-deeply-affect-employers) [Twitter icon](https://twitter.com/intent/tweet?url=https://blog.affinityhrinc.com/major-overtime-change-will-deeply-affect-employers) [pinterest-p icon](http://pinterest.com/pin/create/link/?url=https://blog.affinityhrinc.com/major-overtime-change-will-deeply-affect-employers) [envelope icon](mailto:?body=https://blog.affinityhrinc.com/major-overtime-change-will-deeply-affect-employers) According to a [Department of Labor release](https://www.dol.gov/newsroom/releases/whd/whd20240423-0), a newly issued rule increases the salary threshold required to exempt a salaried bona fide executive, administrative or professional employee from federal overtime pay requirements. The release states, "Effective July 1, 2024, the salary threshold will increase to the equivalent of an annual salary of $43,888 and increase to $58,656 on Jan. 1, 2025." The present annual salary threshold is $35,568. "Starting July 1, 2027, salary thresholds will update every three years by applying up-to-date wage data to determine new salary levels," the release says. **What does this mean?** In an [explanation of the new rule](https://www.dol.gov/agencies/whd/overtime/rulemaking), the DOL gives background on overtime regulation. In brief, the venerable Fair Labor Standards Act of 1938 set rules for minimum wages and additional payment for overtime. However, certain groups have been exempt from the overtime provisions, particularly those falling into the so-called EAP group (executive, administrative and professional employees). An employer can't simply decide employees fall into the EAP group, however. Employees must meet the following three criteria: 1. They must be paid a salary, meaning that they are paid a predetermined and fixed amount that is not subject to reduction because of variations in the quality or quantity of work performed. 2. They must be paid at least a specified weekly salary level. 3. They must perform primarily executive, administrative or professional duties, as provided in the DOL's regulations. The new rule ups the figure for criterion No. 2. As of July 1, that weekly pay is $844, equivalent to the $43,888 annual figure noted above. The big takeaway for employers is that employees who do NOT meet the new salary levels are entitled to overtime after 40 hours/week. This is true even if they meet criteria No. 1 and No. 3. In short, it is now harder for employers to classify workers as belonging to the EAP group.   **[![Subscribe to the Blog](https://no-cache.hubspot.com/cta/default/46386187/b1dcbf01-7ef5-4bb0-83d8-709f2fb2421f.png)](https://cta-redirect.hubspot.com/cta/redirect/46386187/b1dcbf01-7ef5-4bb0-83d8-709f2fb2421f)** **Just the beginning** So is that all you need to know? Actually, no. There are additional provisions and exceptions, as well as changes to the important "highly compensated employee" limits. The rules have always been complicated, and these changes do not simplify anything. Indeed, the [new published rule](https://www.dol.gov/sites/dolgov/files/WHD/flsa/ot-541-final-rule.pdf) runs more than 300 pages — more words than Charles Dickens' "A Tale of Two Cities." Also, your state may have additional overtime rules. For now, the two takeaways are: 1. Open your payroll files because there's a good chance you'll have to make changes. 2. Call your payroll advisers to go over your situation. If and when the DOL publishes more guidance, we'll certainly follow up.   [![Contact us](https://no-cache.hubspot.com/cta/default/46386187/2248e428-1c1e-4e5b-a799-867f05aae34b.png)](https://cta-redirect.hubspot.com/cta/redirect/46386187/2248e428-1c1e-4e5b-a799-867f05aae34b) [PEO Services](https://blog.affinityhrinc.com/tag/peo-services), [Payroll Services](https://blog.affinityhrinc.com/tag/payroll-services) ## Related posts [![](https://blog.affinityhrinc.com/hs-fs/hubfs/comp%20plan.jpeg?height=200&name=comp%20plan.jpeg)](https://blog.affinityhrinc.com/creating-an-equitable-compensation-plan) [PEO Services](https://blog.affinityhrinc.com/tag/peo-services), [Employee Compensation](https://blog.affinityhrinc.com/tag/employee-compensation) ## [Creating an Equitable Compensation Plan](https://blog.affinityhrinc.com/creating-an-equitable-compensation-plan) [Teresa McCormick](https://blog.affinityhrinc.com/author/teresa-mccormick) Feb 20, 2024 7:00:00 AM Compensation comprises such elements as wages or salaries, benefits, union perks, employer-provided... [Read more](https://blog.affinityhrinc.com/creating-an-equitable-compensation-plan) [![employee engagement ](https://blog.affinityhrinc.com/hs-fs/hubfs/shutterstock_1296003478%20(1).jpg?height=200&name=shutterstock_1296003478%20(1).jpg)](https://blog.affinityhrinc.com/increasing-employee-engagement-in-rural-economies) [Agricultural Workers](https://blog.affinityhrinc.com/tag/agricultural-workers), [Employee Engagement](https://blog.affinityhrinc.com/tag/employee-engagement) ## [Increasing Employee Engagement in Rural Economies: Strategies for Business Owners](https://blog.affinityhrinc.com/increasing-employee-engagement-in-rural-economies) [Teresa McCormick](https://blog.affinityhrinc.com/author/teresa-mccormick) Dec 19, 2024 11:00:00 AM Employee engagement can be the difference between a thriving operation and one that's struggling to... [Read more](https://blog.affinityhrinc.com/increasing-employee-engagement-in-rural-economies) [![agricultural worker](https://blog.affinityhrinc.com/hs-fs/hubfs/shutterstock_1762207847%20(1).jpg?height=200&name=shutterstock_1762207847%20(1).jpg)](https://blog.affinityhrinc.com/how-peo-services-empower-agricultural-workers-in-a-changing-economy) [Agricultural Workers](https://blog.affinityhrinc.com/tag/agricultural-workers), [PEO Services](https://blog.affinityhrinc.com/tag/peo-services) ## [Sustainable Growth: How PEO Services Empower Agricultural Workers in a Changing Economy](https://blog.affinityhrinc.com/how-peo-services-empower-agricultural-workers-in-a-changing-economy) [Teresa McCormick](https://blog.affinityhrinc.com/author/teresa-mccormick) Sep 18, 2024 11:00:00 AM Navigating the agricultural landscape requires a focus on sustainable growth, especially amid... [Read more](https://blog.affinityhrinc.com/how-peo-services-empower-agricultural-workers-in-a-changing-economy) --- [![](https://blog.affinityhrinc.com/hs-fs/hubfs/Logo-1.png?width=1500&height=498&name=Logo-1.png)](https://affinityhrinc.com/home) [![napeo_mem_logo_rgb+(1)](https://blog.affinityhrinc.com/hubfs/Affinity_June2024/images/napeo_mem_logo_rgb+(1).png "napeo_mem_logo_rgb+(1)")](https://www.napeo.org/) [**(435)-222-0510**](tel:4322220510) [**info@affinityhrinc.com**](mailto:info@affinityhrinc.com?) 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