The Department of Labor (DOL) has made significant changes to overtime pay rules for 2025. If you’re working a salaried job or are classified as exempt, these new rules could affect whether or not you’re eligible for extra pay when working more than 40 hours a week.
These updates have been eagerly awaited by employees and employers alike, as they change the way overtime compensation is calculated and who is eligible to receive it. If you’re a worker in the U.S., it’s important to understand how these changes might impact your paycheck moving forward.
What Are the New Overtime Rules?
Under the updated overtime law, employees who work more than 40 hours in a week are entitled to receive overtime pay unless they meet certain exemptions. In 2025, the DOL rule increases the salary threshold required to classify an employee as “exempt” from overtime pay.
This means that employees who earn less than the new threshold will automatically qualify for overtime pay, even if their job duties once classified them as exempt.
For example:
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Previously, employees earning up to $23,660 annually were eligible for overtime pay.
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Under the new rules, that threshold jumps to $35,568 per year for overtime pay 2025.
This change aims to ensure that more workers, particularly those in lower-paid positions, will be entitled to receive extra compensation for hours worked beyond the standard workweek.
How Will the New Overtime Rules Affect Employees?
The new overtime rules in 2025 bring some important changes to the workplace. These are the key updates:
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Higher Salary Threshold: As mentioned, the new salary level for exempt employees is now $35,568. If you earn less than this, you’re eligible for overtime pay if you work more than 40 hours in a week.
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Increased Coverage: More workers will now be covered by the overtime law, including those in industries that previously had fewer protections.
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Guaranteed Fair Pay: If you’re working in a service job or as a salaried employee, you might finally get paid for your overtime hours under the new rules. This change ensures employee rights are more firmly protected.
Who Is Affected by the New Rules?
The DOL overtime rules impact salaried workers across various industries. However, the new rules will particularly affect:
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Retail workers: Many managers or assistant managers in retail, who were previously exempt, will now be entitled to overtime pay.
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Healthcare employees: Workers in hospitals or clinics who work long shifts will see more consistent pay for overtime hours.
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Technology workers: Many employees in IT or software development fields might also see changes in their overtime eligibility.
The rules affect salaried workers who don’t meet the executive, administrative, or professional exemptions. If you fall into these categories and your salary is below $35,568, you’re now eligible for overtime pay.
How Does This Affect Employers?
Employers must adjust their payroll systems to ensure they comply with the DOL rule. For businesses, this means reviewing salaries and potentially increasing wages for some employees who were previously classified as exempt. Employers may also need to adjust work schedules to avoid paying overtime when it’s not required.
The changes also offer employee rights protections, ensuring that workers receive fair compensation for their labor, especially in sectors where working long hours is the norm.
Will These Changes Be Enough?
Many advocates for fair labor laws have applauded the changes, but some argue that the salary threshold still isn’t high enough to cover the rising cost of living in certain areas. Workers in more expensive cities, for instance, might still find themselves working long hours without the benefit of overtime compensation.
Despite these concerns, the updated rules are a step forward in protecting employee rights and ensuring that more workers benefit from the protections the overtime law provides.
FAQs
What is the new salary threshold for overtime eligibility?
The new salary threshold is $35,568 per year. If you earn less than this amount, you are now eligible for overtime pay.
Will these changes affect all workers?
The new DOL rule mainly affects salaried workers who were previously considered exempt from overtime pay. Workers earning under $35,568 annually will now qualify for overtime pay 2025.
How does this impact employers?
Employers will need to review salaries and may have to increase pay or adjust schedules to comply with the new overtime laws.
Are all workers in service jobs eligible for overtime?
Not necessarily. Workers in service jobs or any salaried workers must meet the salary threshold of $35,568 to qualify for overtime pay.
When do these changes take effect?
The new overtime law takes effect in 2025. Employers and employees should be aware of the changes and adjust accordingly.
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Aanchal is a passionate writer with a keen interest in storytelling, content creation, and creative expression. She enjoys exploring diverse topics and crafting engaging narratives that captivate readers.