On May 9 PIA, along with a diverse group of business stakeholders sent a letter to the Department of Labor (DOL) urging it to delay the first increase to the minimum salary threshold under the Department’s new overtime final rule until at least September 1st, 2024. Delaying implementation of the rule will give employers the necessary time to adjust to the new regulation.
Phase 1 is currently scheduled to begin on July 1, 2024; Phase 2 is planned for January 1, 2025. The final rule also establishes a new system by which future threshold updates will be made automatically. The automation of salary threshold changes is meant to increase the thresholds for both minimum wage earners and HCEs every three years on July 1; it is intended to reflect changes in wage data as they occur, without requiring the DOL to engage in additional rulemaking. This will allow the DOL to avoid additional public notice and comment periods.
For minimum wage workers, beginning on July 1, the salary threshold will be increased from $35,568 to $43,888 in its first phase. Beginning on January 1, 2025, the minimum wage workers’ annual eligibility threshold will increase again, this time to $58,656.
For HCEs, beginning on July 1, the salary threshold will increase from $107,432 to $132,964. Then, on January 1, 2025, HCEs’ salary threshold will increase again, this time to $151,164. At that point, the HCE salary threshold for overtime eligibility will have increased by 71 percent in a mere six months.
PIA supports the Overtime Pay Flexibility Act (H.R.7367), introduced by Rep. Eric Burlison (R-MO), which would protect workers, employers, and the economy from this ill-advised regulation while preserving DOL’s authority to make future adjustments to the overtime rules as appropriate.