By Oregon Restaurant & Lodging Association,
The first increase in the DOL Overtime Final Rule is scheduled to take effect July 1 and increases the salary threshold to determine whether employees are exempt from overtime pay under the Fair Labor Standards Act (FLSA).
- Provisions include:
- Standard Salary Threshold Increase: Effective July 1, 2024, the standard salary threshold will increase to $844 per week ($43,888 annually). It will rise again on January 1, 2025, to $1,128 weekly ($58,656 annually).
- Highly Compensated Employee (HCE) Threshold Increase: The salary threshold for HCEs will be $132,964 annually starting July 1, 2024, and will increase to $151,164 on January 1, 2025.
- Automatic Updates: Starting July 1, 2027, the earnings thresholds will be automatically updated every three years based on wage data.
- What Operators Should Do Now:
- Review Job Duties: Ensure employees are correctly classified as exempt or non-exempt based on their job duties. Refer to this DOL fact sheet for guidance on determining exempt status. (See also: Final Rule on Overtime Protections and Small Business Compliance Guide)
- Review Payroll Records: Identify salaried exempt employees with wages below the new threshold. For these employees, you might consider 1) Raising their salary above the new limit or 2) Changing their status to non-exempt and properly tracking hours to pay overtime when appropriate.
- Consult Counsel: Consult with an employment attorney licensed in your state to determine how best to comply with the Final Rule and all applicable state and local rules.
Take note, lawsuits including challenges by the Restaurant Law Center are seeking to invalidate and set aside the Final Rule, potentially impacting its implementation.
Resources for Hotels on DOL Overtime Rule:
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