Posted on September 25, 2019

On September 24, 2019, the United States Department of Labor issued a final rule raising the minimum salary required for the “white collar” overtime exemptions (executive, administrative, and professional) from $455 per week ($23,600 per year) to $684 per week ($35,568 per year). The DOL further raised the salary threshold for the “highly compensated” exemption from $100,000 to $107,432. The new rule takes effect on January 1, 2020.

Under this new rule, many employees who are currently classified as salaried exempt will no longer pass the salary test. This change will affect millions of employees who earn more than $23,600 but less than $35,568 per year. The new regulations will significantly impact the nonprofit world, where salaries in the $25,000-$35,000 range are common. Nonprofits should start planning now to meet the upcoming budgetary challenges