FLSA's New Minimum Salary Requirements: Strategic and Tactical Implementation Issues | Sessions

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In 2024, the Department of Labor issued its final rule increasing the minimum salary to meet the white collar exemptions under the FLSA.  The new rule calls for a series of increases to the minimum salary as follows:

1. July 1, 2024:  increase from $684 per week to $844 per week
2. January 1, 2025:  increase again to $1,128 per week
3. July 1, 2027: initial triennial update

The rules are relatively simple to understand.  What is more complex is the decision making on how to deal with employees who make or will make less than the minimum salary as it increases over time.

This program will discuss strategic and tactical issues to consider in implementing the new minimum salary requirements.  Among the issues to be discovered:

1. Determining who is or will be impacted by the new rules
2. Evaluating the cost of increasing salaries to retain the exemption over different periods of time
3. Evaluating the employee relations and other potential costs of reclassifying employees
4. Implementing cost-controls for employees who are reclassified
5. Training reclassified employees on time keeping practices for non-exempt employees as well as the people managers who work with them

In determining who is impacted, employers must remember that a number of states have minimum salary requirements that are higher than those require by the  FLSA.  These laws will be discussed, too.

Finally, the minimum salary must be paid in accordance with the salary basis requirement.  The salary basis requirement is technical and, in some respects, counterintuitive.  We will discuss how employers have inadvertently violated the salary basis requirement and steps employers can take to help avoid violating the requirement.

Learning Objectives:

• Legal requirements of new FLSA minimum salary rule.
• Strategic options in implementing the new rule.
• Tactical considerations in ensuring compliance with salary basis requirement

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