Exempt employees just shifted back – and the reset hits payroll, classification audits, and salary calls
The Labor Department just killed the 2024 FLSA overtime rule. Exempt salary thresholds are back to 2019 numbers – effective immediately.
The US Department of Labor on May 15, 2026 formally scrapped the 2024 overtime rule and restored the salary thresholds that were in place before July of that year. The cleanup, published in the Federal Register, closes out roughly 18 months of legal back-and-forth for HR and payroll teams.
The 2024 rule, issued in April that year, would have lifted the minimum salary for the Fair Labor Standards Act's white-collar exemptions – covering executive, administrative, and professional employees – to $844 per week on July 1, 2024, and again to $1,128 per week on January 1, 2025. It also pushed the highly compensated employee threshold to $132,964, then $151,164, and built in automatic updates every three years.
None of it held. Two federal district courts in Texas struck the rule down – the Eastern District in November 2024, the Northern District a month later. The Fifth Circuit dismissed the appeals on May 5 and May 7, 2026. With the litigation finally over, the Wage and Hour Division said it needed to update the Code of Federal Regulations so employers and employees checking the rules would not be confused about what the law actually is.
The result is a return to the 2019 numbers. The standard salary level for exempt employees is $684 per...
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