The U.S. Department of Labor on May 14 announced a final rule that formally removes the Biden-era 2024 overtime regulations from the Code of Federal Regulations and restores the 2019 rules for “white collar” overtime exemptions under the Fair Labor Standards Act (FLSA). The rule was published in the Federal Register on May 15, 2026, and took effect immediately.
Under the restored 2019 regulations, most executive, administrative, and professional employees must earn at least $684 per week ($35,568 per year) on a salary basis to qualify as exempt from overtime. Highly compensated employees must earn at least $107,432 in total annual compensation. Employees who fall below those levels and meet certain job-duty criteria are entitled to overtime pay for hours worked beyond 40 in a workweek.
The 2024 rule would have raised the standard salary level to $1,128 per week ($58,656 annually) and introduced automatic increases every 3 years. Federal courts in Texas struck that rule down in November 2024, and the DOL had already been enforcing the 2019 thresholds since then. The Fifth Circuit formally dismissed the last pending appeal on May 5, 2026, clearing the way for this cleanup.
The DOL describes the move as a technical correction that aligns the official regulatory text with what courts already ordered. In practice, most employers will not need to change anything right now, because the 2019 salary levels have been the enforceable standard for over a year.
That said, businesses that raised salaries or reclassified workers in anticipation of the now-defunct 2024 rule should review whether to keep those changes as a business decision. Some employers chose to pay above $684 per week voluntarily, and there is no requirement to roll back pay increases already given.
Employers also need to remember that meeting the salary threshold alone is not enough. The DOL has emphasized that exempt employees must satisfy all 3 parts of the test, including salary basis, salary level, and job duties. Misclassifying a non-exempt worker as exempt can lead to back-pay liability for unpaid overtime, plus liquidated damages.
One important detail for multi-state businesses is that several states set their own, higher salary thresholds for overtime exemptions. Federal compliance alone may not be enough in states like California, New York, or Washington, where state rules can be stricter than the FLSA.
Unlike the 2024 rule, the 2019 regulations do not include any automatic inflation-based updates. The $684-per-week and $107,432 thresholds will stay in place unless the DOL begins a new rulemaking process. So far, the agency has not signaled plans to do so.
Small businesses should audit their employee classifications and payroll records now to confirm everything lines up with the 2019 thresholds. Update any internal handbooks or offer letters that still reference the 2024 numbers. For questions, the DOL’s Wage and Hour Division offers a toll-free helpline at 866-487-9243.
