Compliance Stuff

  As 2026 approaches, employers may want to assess the following wage-and-hour compliance issues: rising salary thresholds for overtime exemptions, widening gaps between federal and state minimum wage amounts, and increasingly complex state-specific duties tests and exemption standards. Each can present operational risk if job classifications and pay practices are not carefully aligned with both the Fair Labor Standards Act (FLSA) and stricter state laws. Employers can benefit from ensuring they have updated pay rates and job descriptions to align with the new and changing standards explained below. Quick Hits Employers may want to prepare for 2026 by mapping exempt roles in Alaska, California, Maine, New York, and Washington to new salary thresholds and implementing adjustments aligned with effective dates. To avoid salary compression, employers may want to reconcile pay bands in the thirty-one states with higher minimum wages than federal law and ensure that any threshold multipl...

A federal judge in Texas seemed skeptical that the U.S. Department of Labor (DOL) did not overreach with its latest rule that raised the minimum salary thresholds to the Fair Labor Standards Act’s (FLSA) white-collar overtime exemptions during arguments in a challenge by the state of Texas and several business organizations seeking to block the rule nationwide. Quick Hits A federal judge in the U.S. District Court for the Eastern District of Texas held oral arguments on cross motions for summary judgment in a challenge to the DOL’s rule that raised the minimum salary to be exempt from the FLSA’s overtime pay requirements. The state of Texas and a group of business organizations are seeking to expand a preliminary injunction to block the DOL’s overtime rule on a nationwide basis. Among other things, the rule will increase the minimum salary to be exempt to the equivalent of an annual salary of $58,656 on January 1, 2025. On November 8, 2024, U.S. District Judge Sean Jordan for the East...