Nationwide Hold on DOL’s Increases to Minimum Salary for Overtime Exemption

Early this year, the Department of Labor (DOL) revised the regulations issued under the Fair Labor Standards Act (FLSA) implementing the exemptions from overtime pay for executive, administrative, and professional employees. Known as the “2024 Rule”, the minimum salary threshold for these exempt categories of employees increased in two phases: first on July 1, 2024, from $35,568 to $43,888, and again on January 1, 2025, from $43,888 to $58,656. In a ruling issued on November 15, 2024, the United States District Court for the Eastern District of Texas struck down the “2024 Rule”.

Even though this decision comes from a federal court in Texas, its impact is nationwide. Consistent with case precedent, the Court found that it would be “impracticable, if not impossible to fashion party-tailored relief” as part of the remedy. Thus, given the ruling’s nationwide impact, employers in Illinois are not required to comply with the minimum salary increases under the “2024 Rule”. Rather, the minimum salary threshold reverts back to $35,568 per year for executive, administrative, and professional employees to be exempt from overtime pay.

Robbins Schwartz will monitor the court docket for a potential appeal from the DOL, as well as any changes that may follow from the presidential transition in January 2025.

If you have any questions on the impact of this decision on your workplace, please contact your Robbins Schwartz attorney.