Extra, Extra, read all about it...
Good news for some (mainly employers).
Bad news for others (mainly employees).
On November 15, 2024, a federal court in Texas ruled that the Department of Labor had overstepped its authority with the most recent rule, increasing the minimum salary for exempt employees. ?????? ???????? 1 ?????????????????? ?????? ????????, ?????? ???????????????????? ???????????????? ???????? ?????????? ???????? ?????????? ???????????? ???? ?????????????? 1, 2025, ??????’?? ????????????, ?????? ?????? ?????????????????? ?????????????????? ???????? ???????? ?????????????????? ???? ?????????? ?????????? ?????????? ?????????? ?????? ???? ????????.
???? ??????????, ?????? ?????????? ???????? ?????? ???????????? ??????, ?????? ?????? ???????????????? ???????? ???????????????? ???? ???????? ???????? ???????? ?????????? ???? ???????? 1, 2024. This means that most executive, administrative, and professional employees need to be paid at least $684 per week ($35,568 annually), and not the $844 required by the now-defunct 2024 rule. Employees classified under the highly compensated employee exemption need to be paid at least $107,432 per year, as opposed to $132,964.
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If so inclined, employers can roll back changes they made to comply with the rule in July and halt any plans they had for the second increase in January. However, they can’t?retroactively?reduce pay or change an employee’s classification.
Employees should be informed of any changes to their pay or classification before the changes take effect, and this should be done in compliance with any applicable state or local laws, which may have specific notice requirements.
Employers should also consider the potential impacts on employee morale and do what they can to mitigate any negative ones. If nothing else, explaining that changes are due to fickle federal law and the needs of the business will help employees understand that your decisions aren’t arbitrary.
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HR Girlfriends Consulting is ready to help your organization or small business prepare for what's ahead in 2025. While the salary threshold changes are no longer on the table, there are plenty of other regulations you should be prepared for (every state has its own 2025 laws to implement).
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