The U.S. Department of Labor announced the updated overtime rule in the Fair Labor Standards Act on April 23.
The updated rule will raise the salary threshold for determining who is exempt from required overtime pay. In 2016, a similar rule was issued and then halted by a court injunction, which may occur again this year.
The rule would take effect in two stages and does the following:
- Establishes $43,888 as the salary threshold required to be exempt from overtime pay requirements, effective July 1, 2024.
- Increases the salary threshold to $58,656, effective January 1, 2025.
- Requires salary threshold increases every three years based on the latest earnings data.
Human Resources staff have been working with campus leaders to prepare for the final rule’s announcement. UA’s compliance plan will be completed and announced in the coming weeks.
The overtime rule could require some staff whose annual base salary is below the new threshold to transition to hourly (non-exempt status) while other employees may receive a pay adjustment to maintain exempt status.
While court challenges before implementation of the final rule are possible, HR staff are reviewing data and working with leadership to determine the positions likely affected by the new regulations. If it is blocked by the courts, UA will reassess its approach to these changes and update the campus community.
UA is committed to a smooth transition for employees impacted, and individuals will be contacted once final determinations have been made. For more information, please visit UA Human Resources website.