The move marks the largest expansion in federal overtime eligibility seen in decades. Starting July 1, employers will be required pay overtime to salaried workers who make less than $43,888 a year in certain executive, administrative and professional roles, the Labor Department said Tuesday. That cap will then rise to $58,656 by the start of 2025.
“Too often, lower-paid salaried workers are doing the same job as their hourly counterparts but are spending more time away from their families for no additional pay. That is unacceptable,” acting Secretary of Labor Julie Su said in a prepared statement.
The July 1 increases update the current salary thresholds using methodology put in place under the Trump administration's 2019 regulation. The new rule's methodology takes effect Jan. 1, the Labor Department said, with salary thresholds set to update every three years based on the latest wage data.
Critics have argued that the new regulation could saddle companies with new costs and add to persistent labor challenges. In a statement, U.S. Rep. Virginia Foxx, a North Carolina Republican and chair of the House Education and the Workforce Committee, said that employers "are staring down the barrel of billions in annual costs to comply with the rule" while calling the regulation “excessive and heavy-handed.”
