Some employers are on the fence about returning to exempt status those employees who became nonexempt following the 2024 U.S. Department of Labor (DOL) overtime rule, which was vacated on Nov. 15 and again by a separate district court in a Dec. 30, 2024, order. Here are some factors to consider in making that decision.
Background
“Two federal courts have now struck down the department’s one-size-fits-all salary rule, which would have forced small businesses nationwide to reclassify white-collar employees and take away their flexible work arrangements,” said Sheng Li, litigation counsel for the New Civil Liberties Alliance in Washington, D.C., which argued on behalf of the plaintiff, Flint Avenue LLC, in the December ruling against the DOL.
The U.S. District Court for the Northern District of Texas in December agreed with the reasoning of the U.S. District Court for the Eastern District of Texas, which in November spared HR professionals from having to comply with an increase in the salary threshold for white-collar exemptions from overtime; the threshold had been set to rise to $58,656 annually as of Jan. 1, 2025. The July 1, 2024, increase of the salary threshold from $35,568 to $43,880 per year was also struck down.
2024 Rule ‘Will Remain Dead’
“The 2024 regulation is and will remain dead, and the applicable salary thresholds going forward, until further notice, are those of 2019, with the white-collar exemptions at $684 per week—$35,568 per year—and the highly...
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