Despite legal challenges to the Biden administration’s overtime rule, HR professionals should make plans in case the salary threshold increase scheduled for Jan. 1, 2025, survives.

“There is a great deal of uncertainty in whether the final rule will survive the pending legal challenges,” said Natalie Bare, an attorney with Duane Morris in Philadelphia.

Background on the Final Rule

In April, the U.S. Department of Labor (DOL) raised the salary threshold for white-collar exemptions from overtime requirements: first from $35,568 per year ($684 per week) to $43,888 per year ($844 per week) on July 1 and then to $58,656 per year ($1,128 per week) on Jan. 1, 2025. There are to be further automatic increases to the salary threshold every three years, starting July 1, 2027.

The final rule applies to the Fair Labor Standards Act’s (FLSA’s) executive, administrative, and professional (EAP) exemptions, which are sometimes referred to as “white-collar exemptions,” Bare explained. Employees who qualify are exempt from the FLSA’s minimum wage and overtime pay requirements. Employees can qualify for one of the EAP exemptions if they pass the job duties test, are paid on a salary basis, and are paid at least the standard minimum salary level.

The job duties test is relaxed for highly compensated employees who earn the minimum annual threshold for highly compensated employees and are paid on a salary basis, Bare noted. The final rule also increased the annual salary threshold for highly...

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