The DOL is putting things in reverse, but employers should think twice before doing the same.
In May 2026, the Department of Labor rescinded the 2024 overtime rule that had substantially raised the minimum salary thresholds for FLSA's white-collar exemptions. The federal standard is back to 2019 levels: $684 per week ($35,568 annually), with the highly compensated employee threshold at $107,432.
What does this mean for employers who already raised salaries or reclassified workers to comply? You may have room to revisit those decisions. Whether you should, and how, is the harder question.
Before reversing course
State law may still control. The federal standards have reverted, but adjustments to employee pay must still account for state overtime laws. New York's thresholds, for example, sit well above the federal floor.
Consistency matters. Reversals applied unevenly across similarly situated employees are a reliable way to invite litigation. Document the rationale and apply changes uniformly.
Salary is only one prong. The duties test still applies, and misclassification remains one of the most common (and expensive) wage-and-hour mistakes employers make.
In practice
Reviewing exempt classifications isn't a once-a-decade exercise. If it's been a while, now is a good time.
Questions about how this applies to your company?
Request a consultationThis alert is current as of its publication date and provides general information only. It is not legal advice and does not create an attorney-client relationship.
All client alerts →