There can be costly consequences for misclassifying a worker who gets overtime as one who doesn’t, and Washington just upped the price to play by its rules.

On April 23, 2024, the U.S. Department of Labor (DOL) finalized a rule to increase pay thresholds for overtime eligibility for salaried workers. See “Defining and Delimiting the Exemptions for Executive, Administrative, Professional, Outside Sales, and Computer Employees,” 89 FR 32,842-32,973 (Apr. 24, 2024) (to be codified at 29 C.F.R. pt. 541). The rule is effective July 1, 2024. The DOL estimates the change will redistribute $1.5 billion from employers to workers in the first year.