Executive Briefing for The New FLSA Overtime Rule: What Employers Need to Know

On July 1, 2024, employers of an estimated 4.3 million exempt salaried workers will be required to increase salaries or begin paying overtime under the U.S. Department of Labor’s final FLSA overtime rule.

The increases under the rule are steep---employers paying exempts at the current salary threshold of $35,568 will be faced with a 23% salary increase per employee on July 1, 2024, and a 64% salary increase per employee six months later on January 1, 2025. What’s more, the overtime threshold under the rule will increase automatically on July 1, 2027 and every three years thereafter, absent a downturn in the economy.

The minimum salary will also bring substantial increases in the costs for misclassifying employees and will greatly accelerate the phenomenon of “wage compression” within a company.

This Executive Briefing will explain the new overtime rule as well as the legal and Human Resources considerations in complying with the rule.

Among the topics we will cover are:

• The New FLSA Overtime Rule: What the New Rule Covers; What is Unchanged;
• An Overview of the FLSA and Connecticut’s Salary and Duties Tests;
• Commissions, Bonuses, Incentives, and the Minimum Salary Rule;
• Fallout: The Problem of “Wage Compression” and the New Rule;
• Meeting the Test: Increasing Salary or Going Non-Exempt? What to Consider/What to Say;
• The Stakes of Misclassifying Employees;
• The New Rule and Correcting Past Classifications: What Not to Say to Employees;
• Federal Wage Audits: What Happens When the U.S. DOL Goes to Your Company; What you Should Do; What NOT to Do.