Community Action Agencies (CAAs) will soon need to consider the exempt status of their employees and eligibility for overtime pay following recent regulatory changes issued by the U.S. Department of Labor (DOL). On April 26, 2024, DOL published a Final Rule on Defining and Delimiting the Exemptions for Executive, Administrative, Professional, Outside Sales, and Computer Employees (the “Final Rule”). Key changes in the Final Rule include: (i) on July 1, 2024, raising the salary level above which certain employees are exempted from federal overtime pay requirements, from $684/week to $844/week; (ii) on January 1, 2025, revising the methodology used to determine the salary level and raising it to $1,128/week; and (iii) establishing, as of July 1, 2024, automatic updates to the salary level every 3 years. The effective date for the Final Rule is July 1, 2024. The agency estimates an additional 1 million workers will become eligible for overtime pay in the initial update in July, and an additional 3 million workers will become eligible for overtime pay in the subsequent update in January.

On May 28, 2024, CAPLAW hosted a webinar to discuss the Final Rule, impacts the changes could have on CAAs, and any new developments related to its implementation. View the recording and slides for this webinar here.