Federal Overtime Salary Threshold in 2026: The $684 Weekly Rule Explained
On May 14, 2026, the U.S. Department of Labor’s Wage and Hour Division announced a technical amendment restoring the operative federal regulations for the executive, administrative, and professional exemptions under the Fair Labor Standards Act. The amendment removed regulatory language from the judicially vacated 2024 overtime rule and republished the standards established by the 2019 rule.
Under the restored federal regulations, most employees claimed as exempt under the executive, administrative, or professional exemptions must receive at least $684 per week on a salary basis. That is equivalent to $35,568 per year for a full-year employee. The restored highly compensated employee threshold is $107,432 in total annual compensation, including at least $684 per week paid on a salary or fee basis.
What changed in May 2026?
The May 2026 action did not create an entirely new overtime test. It updated the Code of Federal Regulations to reflect federal court judgments that vacated the Department of Labor’s 2024 rule. The restored text became effective when it was published in the Federal Register on May 15, 2026.
This matters because employers, workers, payroll providers, and attorneys need the regulations to display the standards that are actually enforceable. As of July 2026, the federal salary threshold shown in the restored regulations is $684 per week, not the higher amounts that had been included in the vacated 2024 rule.
The three-part federal exemption test
An employee is not automatically exempt from overtime merely because the employee receives a salary, has a management-sounding title, or earns more than $684 per week. Most white-collar exemptions require all three of the following elements:
- Salary level: The employee must generally receive at least $684 per week.
- Salary basis: The employee must regularly receive a predetermined amount that is not reduced because of variations in the quality or quantity of work, subject to limited exceptions.
- Duties test: The employee’s actual primary duties must satisfy the requirements of a recognized exemption.
Failure on any required element can make the employee nonexempt and eligible for overtime pay. Job titles such as manager, coordinator, administrator, supervisor, or specialist do not decide the issue by themselves.
Executive exemption
The executive exemption generally requires management to be the employee’s primary duty. The employee must usually direct the work of at least two full-time employees or the equivalent and must have meaningful authority or influence over hiring, firing, promotion, or other status changes.
A person called an assistant manager who spends nearly all working time performing the same routine tasks as hourly employees may not satisfy the executive duties test, even when the salary exceeds $684 per week.
Administrative exemption
The administrative exemption generally applies to office or non-manual work directly related to management or general business operations. The employee must exercise discretion and independent judgment on matters of significance.
Routine clerical work, scripted customer service, data entry, and work governed by detailed procedures do not automatically qualify. The analysis focuses on what the employee actually does and the level of independent authority exercised.
Professional exemption
The learned professional exemption generally requires work involving advanced knowledge in a field of science or learning, customarily acquired through prolonged specialized intellectual instruction. Certain licensed professionals and employees in qualifying creative occupations may be covered by separate professional standards.
Technicians and employees who gained expertise mainly through experience, short courses, or general education may fail the learned-professional test even when their work is skilled and important.
Highly compensated employees
The restored regulations set the highly compensated employee threshold at $107,432 in total annual compensation. This is not a salary-only exemption. The employee must perform office or non-manual work, receive at least $684 per week on a salary or fee basis, and customarily and regularly perform at least one exempt executive, administrative, or professional duty.
State law can require a higher threshold
The federal $684 threshold is only the federal floor. Several states impose higher salary thresholds, different duties tests, daily overtime, or narrower exemptions. When federal and state requirements both apply, the employer generally must follow the standard that provides the employee greater protection.
For example, a worker may satisfy the federal salary threshold but remain nonexempt under a state rule tied to the state minimum wage. Employers operating in multiple states should not use one federal classification checklist for every location.
Example calculation
Assume an employee receives a salary of $800 per week and works 50 hours. The salary exceeds the federal $684 threshold, but the employee performs routine nonexempt work and does not satisfy a duties test. Merely paying $800 does not eliminate overtime.
The precise regular-rate calculation depends on the employment agreement and applicable law. If the $800 salary is understood to cover 40 straight-time hours, the regular rate would be $20 per hour and 10 overtime hours would generally be paid at $30 per hour, producing $300 in overtime compensation.
Employer compliance checklist
- Confirm the employee receives at least the applicable federal and state salary level.
- Review actual duties rather than relying on the job description or title.
- Confirm salary deductions comply with the salary-basis rules.
- Reassess employees whose duties have changed over time.
- Check state and local exemption rules separately.
- Keep records showing why each exemption was selected.
Frequently Asked Questions
What is the federal overtime salary threshold in 2026?
The restored federal threshold is generally $684 per week, equivalent to $35,568 per year, for most executive, administrative, and professional exemptions.
Does earning more than $684 make an employee exempt?
No. The employee must also be paid on a qualifying salary basis and perform duties that satisfy a specific exemption.
What is the highly compensated employee threshold?
The restored federal total annual compensation threshold is $107,432, including at least $684 per week on a salary or fee basis.
Can a state require a higher salary?
Yes. State law may impose a higher threshold or a more protective duties test. The more protective applicable standard generally controls.
Was the 2024 federal overtime rule restored?
No. The May 2026 technical amendment removed the vacated 2024 text and restored the operative 2019 regulatory language.
Official Sources
- U.S. Department of Labor — May 14, 2026 technical amendment announcement
- Federal Register — 91 FR 27833
- U.S. Department of Labor — Fact Sheet 17A
This article is for general educational purposes and is not legal, tax, or payroll advice. Classification depends on the employee’s facts, duties, compensation method, location, and applicable law.