FLSA Minimum Salary Increases – Again, Already?

Seemingly lost in the election debate whether to tax tips or overtime, is the next looming increase in the minimum salary requirements for certain Fair Labor Standards Act (“FLSA”) exemptions. Assuming employers have already weathered the July 2024 storm caused by the increases in the FLSA minimum salary threshold at that time, the minimum salary threshold for most employees classified as exempt under the administrative, professional, or executive exemptions will substantially increase on January 1, 2025.

That means that to maintain the overtime exemption, employers must increase the minimum salary to at least $58,656.00 per year (an increase of almost $15,000 from the current salary threshold of $43,888.00 per year). As we reported back in May 2024, employers are left with two (2) options:

1. Raise the salaries of exempt employees if they are currently at or below the minimum to $1,128.00 a week or $58,656.00 annually; or
2. Convert these employees to non-exempt employees, track all hours worked, and pay overtime for hours worked after forty (40) in any work week.

We previously discussed the significant factors employers should consider in making this difficult determination. If you have questions regarding this and other labor and employment-related matters, please reach out to our Labor and Employment Law team for assistance.