Department of Labor Removes Vacated 2024 Overtime Rule from Federal Regulations

The U.S. Department of Labor has officially amended its regulations to remove the 2024 overtime exemption salary increases that were previously invalidated by federal courts. The amendment formally restores the salary thresholds established under the 2019 rule for executive, administrative, and professional employees classified as exempt under the Fair Labor Standards Act (FLSA).

The Department’s announcement confirms what many employers have already been operating under since late 2024. Following litigation in the Eastern District of Texas, the Department of Labor stopped enforcing the 2024 increases after the rule was vacated by the court. The newly issued technical amendment updates the Code of Federal Regulations to reflect that reality.

Under the restored federal standards, the salary thresholds for exempt employees remain:

• $684 per week, or $35,568 annually, for standard white-collar exemptions

• $107,432 annually for highly compensated employees

The technical amendment removes the higher salary thresholds adopted in April 2024. That rule would have significantly increased the minimum salary requirements for exempt employees beginning in July 2024 and again in January 2025. However, federal courts vacated the rule in November 2024 before the second increase took effect.

Importantly, the Department of Labor emphasized that this amendment does not change current enforcement practices because the agency has already been applying the 2019 thresholds since the court’s ruling.

For employers, this development provides additional clarity and certainty regarding wage-and-hour compliance obligations. Employers should continue to evaluate exempt classifications using the restored 2019 salary thresholds, together with the applicable duties tests under the FLSA.

Businesses should also remember that some states impose salary thresholds or exemption standards that are more demanding than federal law. Employers operating in multiple jurisdictions should ensure their classification practices comply with both federal and state requirements.

The Department’s action likely closes the chapter on the 2024 federal overtime rule unless a future administration proposes and successfully implements a new exemption framework.

Why This Matters for Employers

Misclassification issues remain one of the most common sources of wage-and-hour litigation. Employers who rely on outdated salary thresholds or improperly classify employees as exempt may face exposure for unpaid overtime, liquidated damages, and attorneys’ fees.

This latest regulatory update serves as an important reminder for businesses to periodically review:

• Exempt employee salary levels

• Job duties and responsibilities

• Timekeeping practices

• State-specific wage and hour requirements

Employers with questions regarding exempt classifications or overtime compliance should consult experienced employment counsel to evaluate their current practices.