Remaining compliant with current employment statutes is critical for the financial solvency and positive reputation of modern organizations. The laws at both the state and the federal level constantly fluctuate, which means that businesses may need help tracking their obligations to employees. Wage laws are among the most important for a business to follow, as both workers and regulatory agencies can take legal action over violations of such laws.
In addition to maintaining payroll records and providing wages that align with baseline standards, companies also have to abide by regulations related to overtime pay. Many overtime pay issues involve hourly workers, but a new federal rule may lead to overtime wage claims brought by salaried employees.
The minimum salary level has increased
The federal government maintains a minimum salary that employers must provide if they want workers to put in more than 40 hours without being eligible for overtime pay. That exemption threshold recently increased. It remained static from 2019 until July 1st, 2024, at $35,568.
As of July 1st, salaried employees must earn $43,888 annually to be exempt from overtime pay rules. That threshold increases again on January 1st, 2025 to $58,656. The new rule also provides for adjustments every three years.
Employers may need to rework salary wages to ensure their workers are exempt. Otherwise, they may need to begin budgeting for overtime wages for those who put in more than 40 hours of work per week or being proactive about preventing overtime work.
Ensuring compliance with all current employment laws, including wage regulations, is important for a company’s legal compliance, finances and reputation. Organizations with the right support can adjust their practices proactively in response to changing employment laws.