Exempt Status in the Restaurant Industry: Reassessing Your Workforce in Light of the DOL’s New Rule

In April 2024, the United States Department of Labor (DOL) published a new rule that significantly increases the salary threshold for exempt employees: how do these changes impact the restaurant industry?  With a scheduled increase in the salary threshold slated for January 1, 2025, employers may want to review their exemptions to ensure each position that has been classified as exempt passes the requisite legal tests, including both the salary and duties tests.  

As employers are aware, the Fair Labor Standards Act (FLSA) requires covered employers to pay employees a minimum wage for all hours worked and time-and-a-half (overtime pay) for hours worked over 40 in a workweek.  However, employees can be exempt from these requirements if certain tests are satisfied.  Generally, to be exempt, federal law requires satisfaction of the “salary” and “duties” tests.  The salary test refers to the fact that exempt employees must be paid a salary and for most exemptions, there…