New Fair Labor Standards Act (FLSA) Regulations
On April 23, 2024, the U.S. Department of Labor (DOL) announced the final rule to amend the Fair Labor Standards Act (FLSA) overtime regulations. This rule expands protections for lower-paid, salaried workers by increasing the salary thresholds required to exempt a salaried bona fide executive, administrative, or professional from federal overtime pay requirements. The first phase is effective July 1, 2024, and will increase to the equivalent of $43,888 annually for exempt employees. The second phase is effective January 1, 2025. All members of the Texas A&M University System are required to comply with the regulations.
Important Information:
Lawsuits challenging the amended overtime regulations have been filed by the State of Texas, in addition to a motion for a temporary restraining order (TRO) that seeks to block the rule from going into effect on July 1. A judge could decide whether to grant the State of Texas’s motion for a TRO before the July 1 effective date. The TRO would block the rule from going into effect until the Supreme Court decides if it is valid. If the rule is blocked, your salary will not change.
Impact:
Nonexempt (overtime eligible) employees, teaching faculty, and Graduate Assistants are not impacted.
Exempt employees (NOT overtime eligible) making less than the new salary threshold based on weekly earnings may be impacted.
- Some impacted employees will become nonexempt and become eligible for overtime compensation for hours worked over 40 in a workweek.
- Some impacted employees may receive salary adjustments and remain exempt. They will continue to be ineligible to earn overtime for any time worked over 40 hours.
- A small number of exempt employees making more than the new FLSA thresholds may become nonexempt if their job code changes to nonexempt.
- Exempt employees who work a part-time schedule may also be impacted if their weekly earnings are below the new thresholds.
Employees who move from exempt to nonexempt will have more detailed timekeeping requirements, but nothing about their work responsibilities will change. A final determination of impacted employees is under review in preparation for the second phase. Information will be communicated in the fall 2024 to impacted departments and employees.