DOL Reverses Biden-Era Overtime Rule: What Employers Need To Know

Key Takeaways:

• The U.S. Department of Labor has rescinded the 2024 rule that sought to expand overtime eligibility by raising the salary threshold for white-collar exemptions under the Fair Labor Standards Act.
• The DOL is reinstating the overtime salary threshold from the first Trump Administration: $684 per week ($35,568 annually) as the operative standard.

On May 15, 2026, the U.S. Department of Labor (DOL) published a technical amendment in the Federal Register formally rescinding the overtime rule adopted by the Biden Administration’s DOL in 2024. The amendment reinstates the overtime regulations that were in place prior to July 1, 2024, effectively returning to the salary threshold established during President Trump's first term.

Under the Fair Labor Standards Act, bona fide executive, administrative, and professional, outside sales, and computer employees who meet certain duties tests and whose salaries exceed a specified threshold are exempt from the statute's overtime requirements. The Biden Administration's 2024 rule sought to significantly expand overtime eligibility by raising the minimum salary threshold: first to the equivalent of $43,888 annually, with a planned subsequent increase to $58,656 a year.

The 2024 rule, however, prompted immediate legal challenges. Two federal judges in Texas struck down the rule before the second salary increase could take effect, vacating the regulation. The Biden Administration appealed those decisions to the U.S. Court of Appeals for the Fifth Circuit. Earlier this month, the Trump DOL dropped both appeals, and the Fifth Circuit dismissed the cases. The technical amendment cited those judicial developments as the basis for formalizing the rescission.

Since the district court rulings vacating the 2024 rule, the DOL's Wage and Hour Division has already been enforcing the overtime regulations at the standards set under the 2019 rule, namely, the $684 per week ($35,568 annual) salary threshold. As the agency said, "[p]ut simply, this action is a technical correction accounting for changes in the law that have already occurred."

Considering this amendment, employers that raised salaries or reclassified employees in anticipation of the now-rescinded 2024 rule should evaluate whether to maintain those changes or revert to prior compensation structures. Any adjustments should be carefully considered in light of employee relations, state law requirements, and contractual obligations.

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