FLSA Changes

On April 23, 2024, the U.S. Department of Labor (DOL) released a final rule that updates the FLSA salary threshold for overtime-exempt workers. 

Overview of changes

The new regulations will take effect in a phased implementation approach to the minimum salary threshold before an employee can be classified as exempt from overtime pay. The phases are:

• Phase1: Effective July 1, 2024, the minimum salary threshold for exempt employees will change to $43,888 per year.
• Phase 2: Effective Jan. 1, 2025, the minimum salary threshold for exempt employees will change to $58,656 per year.
• Phase 3: The threshold will be automatically updated every three years starting in July 2027. 

At Virginia Tech, these changes impact all exempt positions including faculty, staff, and P14s are impacted. 

What do the FLSA changes mean for impacted employees?

Once the legislation is implemented, employees with annual salaries below the threshold may become eligible for overtime.

• The Division of Human Resources (HR) has met with HR partners in colleges and business units to address employees whose salaries fall below the $43,888 threshold that will be implemented on July 1. Any employees impacted by this change will receive communication from their department.
  
• All employees hired at Virginia Tech after July 1 will have their position designated as non-exempt if their salary is $43,888 or below.
  
• The threshold change may be challenged in court. HR will monitor any court proceedings and work with university leaders to determine Virginia Tech’s response. 
• HR is continuing to monitor and plan for the threshold increase to $58,656 on Jan. 1, 2025, and are working with campus HR partners to review the positions that fall under this threshold.

Salary thresholds

On July 1, 2027 and every three years thereafter, the threshold will be automatically increased. 

For additional questions, contact your HR Representative or HR's Compensation Team at compensation-g@vt.edu.