Tailored Solutions For Employment Law Matters

A low salary could lead to an overtime wage claim

On Behalf of | Jun 12, 2024 | Employment Law

There are many questionable ways that businesses may try to avoid paying workers overtime wages. They may trick hourly workers into doing certain tasks before they clock in for a shift. They may have no-overtime policies and then claim the policy makes it acceptable to refuse to pay a worker for the extra hours they worked one week.

Other times, companies may try to claim that a worker is exempt when they actually are not. Sometimes, companies misclassify workers as independent contractors to bypass overtime rules. Other times, they may pay the worker a salary and tell them they are exempt.

Many workers who earn a salary are exempt from overtime payrolls. However, not all salaried employees earn enough compensation to be exempt from overtime pay requirements. The federal government and New York state maintain clear standards for the minimum salary employers must pay if they require overtime without additional compensation.

What is the minimum salary?

The salary requirement to bypass overtime pay rules has recently changed. For years, the minimum salary a company had to pay to avoid overtime pay obligations was $35,568.As of July 1st, 2024, a worker needs to make at least $43,888 to be exempt from overtime pay requirements. That minimum salary increases again as of January 1st, 2025. Soon, anyone paid less than $58,565 may be eligible for overtime wages if they put in more than 40 hours per work week.

New York also recently adjusted exempt salary rules. Exempt executive and administrative workers must earn $1,124.20 per week or $58,458.40 each year to be exempt from overtime wage rules. However, if they work in New York City or in Nassau, Suffolk, or Westchester counties, then the minimum is higher. Workers in those more competitive areas should receive at least $1,200 per week or $62,400 annually to be exempt.

This new change in policy may force some companies to change their scheduling practices. Other businesses may opt to give workers raises. Yet, some employees may end up denied overtime wages regardless. Those workers may need to pursue a wage and hour claim to demand the overtime pay they deserve. Following changes in employment law can help workers make use of the laws implemented for their protection.