Increased Salary Levels for White Collar Employees

Increased Salary Levels for White-Collar Employees Earlier this week the U.S. Department of Labor (DOL) announced a final rule to amend current requirements employees in white-collar occupations must satisfy to qualify for an overtime exemption under the Fair Labor Standards Act (FLSA). The new rule, effective July 1, 2024 (unless delayed due to legal challenges) increases the annual standard salary levels as follows: • From $35,568 to $43,888 ($107,432 to $132,964 per year for highly compensated employees). On January 1, 2025, the salary levels are increased to: • $58,656 per year ($151,164 per year for highly compensated employees). Beginning July 1, 2027, and every three years thereafter, the DOL will increase the standard salary level. Impact on Benefit Plans: Employers may need to adopt changes to comply with the rule’s requirements. If employees are reclassified as non-exempt rather than exempt or vice versa, the reclassification can impact benefit eligibility classes for ancillary coverages (life, STD and LTD) if the plan design is based on classification. If salary adjustments are made in lieu of reclassifying employees, it could impact benefit calculations and premium. Please notify your EBS consultant whenever considering classification or broad compensation changes so we can work with you to evaluate the impact on benefits. An overview of the Final Rule is available at the link below. Resources: DOL Announces Final Overtime Rule Increasing Salary Levels for White-collar Employees