A federal salary line that determines whether a company can legally treat an executive, administrative, or professional employee as exempt from overtime pay is back at $684 a week, or $35,568 a year, after the U.S. Department of Labor’s Wage and Hour Division restored that figure on May 15, 2026. The move ends an 18-month legal fight over a 2024 rule that would have pushed the line to $1,128 a week, or $58,656 a year, by January 2025 — an increase two federal courts threw out before most of it ever took hold. For salaried workers whose pay sits between the old number and the number the 2024 rule tried to set, this is the line that now decides whether time-and-a-half is guaranteed.
A line reset to where it stood before 2024
Federal law already requires that most hourly and salaried employees get time and one-half pay for every hour worked past 40 in a week, unless a specific exemption applies. The exemption used most often covers so-called white-collar workers in an executive, administrative, or professional role, and it has always rested on three separate conditions holding true at once: the person’s actual job duties have to match the legal definition, the pay has to be a fixed salary rather than an hourly wage, and that salary has to clear a minimum dollar floor. The floor is the number that just moved back.
That floor is $684 a week, or $35,568 a year for a full-year worker, and it comes paired with a separate $107,432 annual threshold for a smaller category called highly compensated employees. The Wage and Hour Division confirmed both figures in a technical amendment that took effect the moment it was published, restoring the exact regulatory text the department wrote in 2019 and had already been enforcing since a court fight began. Anyone paid a fixed salary below $684 a week in one of these roles cannot be classified as exempt under this test, no matter how senior the title sounds — the company owes overtime.
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Two federal courts undid the increase, and the Fifth Circuit made it final
The number never should have needed restoring at all if the 2024 rule had survived, but it didn’t. That rule would have raised the salary floor to $844 a week on July 1, 2024, then to $1,128 a week on January 1, 2025, with automatic increases every three years after that. Business groups and the State of Texas sued, and on November 15, 2024, the U.S. District Court for the Eastern District of Texas vacated the entire rule nationwide in Texas v. U.S. Department of Labor, ruling that the agency had let salary override the duties test Congress actually wrote into the law. A second court, the U.S. District Court for the Northern District of Texas, vacated the same rule again on December 30, 2024, in a separate case brought by a private employer.
Those rulings meant the 2024 rule was already dead in practice, but the Code of Federal Regulations technically still displayed its text until the appeals ran their course. The Fifth Circuit Court of Appeals dismissed the government’s remaining appeals in both cases on May 5 and May 7, 2026, turning the vacaturs into final judgments. That is what forced the Wage and Hour Division’s hand: with no appeal left to resolve, the department had no live path back to $1,128 a week, and it rewrote the CFR eight days later to match the reality that had existed since late 2024. The department itself called the move “a technical correction accounting for changes in the law that have already occurred,” not a new policy choice.
The salary line is not the only gate — duties still count
The $35,568 figure gets attention because it is a clean dollar number, but it was never the sole test. A worker’s actual day-to-day duties still have to fit the legal definition of executive, administrative, or professional work — managing a department and directing other employees, exercising independent judgment on significant business matters, or applying advanced knowledge in a specialized field, depending on which category applies. A salaried employee earning well above $35,568 who spends most of the workweek on routine, closely supervised tasks can still be misclassified as exempt and still be owed overtime, regardless of the paycheck’s size. The reverse also holds: certain workers, including outside salespeople, teachers, and licensed doctors and lawyers actively practicing their profession, are exempt from the salary test entirely and are judged on duties alone. The federal government’s own baseline overtime rule, unrelated to any of these exemptions, remains straightforward — covered employees get time and a half for hours worked past 40 in a week.
Several states already require far more than $35,568
Where an employee works can matter more than the federal number. States are free to set their own, higher salary floors for the same exemption, and when a state threshold exceeds the federal one, employers have to follow the higher figure. Washington is a clear example: the state’s Department of Labor & Industries requires exempt salaried workers to earn at least 2.25 times the state minimum wage, which for 2026 works out to $1,541.70 a week, or roughly $80,168 a year — more than double the restored federal line. That multiplier is scheduled to keep climbing to 2.5 times the state minimum wage by 2028. A worker paid $50,000 a year in an office in Seattle could be legally exempt under the federal rule and still be owed overtime under Washington’s own regulation, because the state’s own labor agency requires the more protective number to win whenever the two conflict.
Other states run their own separate systems with their own dollar figures, so a worker’s actual overtime rights depend on checking both the federal floor and whatever the state where they work has set independently. The federal number restored on May 15, 2026, is the national baseline everywhere; it is not the ceiling.
This article was produced with AI assistance and reviewed by a human editor. Figures are linked to their primary sources; where a claim could not be verified from the public record, we say so.
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