November 26, 2024
BACKGROUND
As employers are aware, in order to be exempt from Fair Labor Standards Act (FLSA) minimum wage and overtime requirements, an employee must meet the requirements of an executive, administrative or professional exemption. These exemptions include a requirement that employees meet relevant salary thresholds. Prior to July 1, 2024, the FLSA salary threshold minimum was set to $684/week ($35,568 annually). On April 23, 2024, the U.S. Department of Labor announced a Final Rule that took initial effect on July 1, 2024, and raised the FLSA salary threshold to $844/week ($43,888 annually). The Final Rule additionally provided for another increase of the salary threshold beginning on January 1, 2025 to $1,128/week ($58,656 annually).
UPDATE: FINAL RULE VACATED
The Final Rule was subject to legal challenges and, on November 15, 2025, the U.S. District Court for the Eastern District of Texas ultimately vacated the Final Rule. This means that, for now, the Final Rule is no longer effective. Further, the FLSA salary threshold has reverted back to the pre-July 1, 2024 amount, $684/week ($35,568 annually).
It is unclear whether this decision will be appealed, and it is further unclear what position the incoming administration will take on this policy.
NEXT STEPS
Notwithstanding the development at the federal level, please note that Maine employers are still required to ensure compliance with applicable state law. In addition to the federal requirements pursuant to the FLSA, Maine sets its own salary threshold minimums for the purposes of determining whether an employee meets a relevant exemption from minimum wage and overtime requirements. Currently, the salary threshold under Maine law is $816.35/week ($42,450.20 annually). As of January 1, 2025, the salary threshold will increase to $845.21/week ($43,951 annually). We encourage employers to ensure compliance with applicable Maine law, and will keep you apprised of relevant developments at the federal level.
If you have any questions, please feel free to contact the Jensen Baird attorney you normally work with, or Alyssa Tibbetts or Paige Eggleston by phone at (207) 775-7271 or by e-mail at atibbetts@jensenbaird.com / peggleston@jensenbaird.com.