© 2024 American Payroll Institute, Inc.
December 6, 2024 Volume 32 Issue 12
District Court Invalidates Rule for ‘White Collar’ Threshold Increase
On November 15, a district court vacated and set aside
the U.S. Department of Labor’s (DOL) final regulations
to increase the minimum salary level for the Fair Labor
Standards Act (FLSA) executive, administrative, professional,
outside sales, and computer employee (EAP) or “white collar”
exemptions [Texas v. U.S. Department of Labor, No. 4:24-cv-499,
2024 U.S. Dist. LEXIS 207864 (E.D. Texas, 11-15-24)].
The ruling to set aside the regulations applies on
a nationwide basis. In June, the same court granted a
preliminary injunction to block the rule from going into
effect for employees working for the state of Texas (see
PAYROLL CURRENTLY, Issue 7, Vol. 32).
With the latest ruling, the minimum salary level reverts
to the previous threshold set in 2019: $684 per week ($35,568
per year). The threshold for highly compensated employees
(HCEs), which also would have been increased under the
2024 rule, reverts to the previous threshold of $107,432 per
year. The DOL confirmed that, for enforcement purposes, it
is applying the 2019 rule’s minimum salary levels.
The 2024 rule
On April 23, the DOL announced a final rule to increase
the salary thresholds for the EAP exemptions (89 F.R. 32842,
4-26-24 see PAYROLL CURRENTLY, Issue 5, Vol. 32). The 2024
final rule had three components:
(1) On July 1, the minimum salary level for exempt
employees would have increased to $844 per week ($43,888
per year)
(2) On January 1, 2025, the minimum salary level would
have increased again to $1,128 per week ($58,656 per year)
and
(3) The salary level would have been updated every 3
years to match the 35th percentile of weekly earnings of full-
time salaried workers in the lowest-wage Census Region.
The 2024 final rule also would have increased the salary
requirement for HCEs from $107,432 to $132,964 per year on
July 1, then from $132,964 to $151,164 per year on January
1, 2025. The HCE level also would have been adjusted every
3 years.
Court said DOL ‘exceeded authority’
The ruling is a consolidation of two court cases with
the same assigned judge in the Eastern District of Texas –
Texas v. U.S. Department of Labor (No. 4:24-cv-499) and Plano
Chamber of Commerce v. U.S. Department of Labor (No. 4:24-
cv-468).
In its ruling, the court said that Congress expressly
delegated to the DOL the authority to define and delimit
District Court Invalidates Rule for ‘White Collar’ Threshold
Increase. ............................................................................................1
IRS Announces 2025 Retirement Plan Contribution, Benefit
Limits.................................................................................................. 2
Two States, Virgin Islands Subject to FUTA Credit Reduction
for 2024.............................................................................................. 3
SECURE 2.0 Act Changes May Affect Upcoming Payrolls......... 3
IRSAC Issues 2024 Annual Report.................................................... 5
State Unemployment Insurance Taxable Wage Bases for 2025...6
IRS Shares Information About IRIS, FIRE for Upcoming Filing
Season. ..............................................................................................7
Latest Federal Contractor Minimum Wage Case Causes
More Uncertainty........................................................................... 7
Court Rules Approval of FLSA Settlement Is Unnecessary........ 8
DOL Opinion Letters Answer FLSA, FMLA Questions................. 8
IRS Releases 2025 Tables That Will Be Available in
Publication 15-T. .............................................................................9
Tables Issued for Figuring Amount Exempt From Levy in 2025.... 9
IRS Releases 2024 Form 944 and Instructions.............................. 9
IRS Extends Deadline for TPPs to Fix Incorrect ERC Claims. .....9
Free eBook Answers Top Payroll Questions................................10
E-Verify Contacts Users About Transition to Login.gov...........10
IRS Announces Form 1099-K Reporting Threshold for 2024. ...10
11th Circuit Rules Against Employer That Failed to Provide
Records. ...........................................................................................10
Four States Test e-NMSN Through OCSS.....................................12
DOJ Signs Agreement With Company to Resolve
Immigration Issue.........................................................................12
Employers Can Enroll in IRS eLevy Program to Save Time,
Costs. ................................................................................................12
7th Circuit Rules Travel Time for Overnight Jobs Is
Compensable.................................................................................12
5th Circuit Allows Penalty for Employee Who Would Not
Pay Taxes.........................................................................................13
Employers Must Certify Eligibility of New Hires to
Claim WOTC...................................................................................13
Court Awards Attorneys’ Fees to Employer in IRS Tax Case....14
State and Local Highlights...............................................................15
Payroll Professional Offers IRS Recommendations in IRSAC
Report. ........................................................................................17
PayrollOrg Asks Arizona Attorney General to Maintain EWA
Interpretation. ..........................................................................18
Payroll Management of Tribal Child Support Orders. .........18
December 6, 2024 Volume 32 Issue 12
District Court Invalidates Rule for ‘White Collar’ Threshold Increase
On November 15, a district court vacated and set aside
the U.S. Department of Labor’s (DOL) final regulations
to increase the minimum salary level for the Fair Labor
Standards Act (FLSA) executive, administrative, professional,
outside sales, and computer employee (EAP) or “white collar”
exemptions [Texas v. U.S. Department of Labor, No. 4:24-cv-499,
2024 U.S. Dist. LEXIS 207864 (E.D. Texas, 11-15-24)].
The ruling to set aside the regulations applies on
a nationwide basis. In June, the same court granted a
preliminary injunction to block the rule from going into
effect for employees working for the state of Texas (see
PAYROLL CURRENTLY, Issue 7, Vol. 32).
With the latest ruling, the minimum salary level reverts
to the previous threshold set in 2019: $684 per week ($35,568
per year). The threshold for highly compensated employees
(HCEs), which also would have been increased under the
2024 rule, reverts to the previous threshold of $107,432 per
year. The DOL confirmed that, for enforcement purposes, it
is applying the 2019 rule’s minimum salary levels.
The 2024 rule
On April 23, the DOL announced a final rule to increase
the salary thresholds for the EAP exemptions (89 F.R. 32842,
4-26-24 see PAYROLL CURRENTLY, Issue 5, Vol. 32). The 2024
final rule had three components:
(1) On July 1, the minimum salary level for exempt
employees would have increased to $844 per week ($43,888
per year)
(2) On January 1, 2025, the minimum salary level would
have increased again to $1,128 per week ($58,656 per year)
and
(3) The salary level would have been updated every 3
years to match the 35th percentile of weekly earnings of full-
time salaried workers in the lowest-wage Census Region.
The 2024 final rule also would have increased the salary
requirement for HCEs from $107,432 to $132,964 per year on
July 1, then from $132,964 to $151,164 per year on January
1, 2025. The HCE level also would have been adjusted every
3 years.
Court said DOL ‘exceeded authority’
The ruling is a consolidation of two court cases with
the same assigned judge in the Eastern District of Texas –
Texas v. U.S. Department of Labor (No. 4:24-cv-499) and Plano
Chamber of Commerce v. U.S. Department of Labor (No. 4:24-
cv-468).
In its ruling, the court said that Congress expressly
delegated to the DOL the authority to define and delimit
District Court Invalidates Rule for ‘White Collar’ Threshold
Increase. ............................................................................................1
IRS Announces 2025 Retirement Plan Contribution, Benefit
Limits.................................................................................................. 2
Two States, Virgin Islands Subject to FUTA Credit Reduction
for 2024.............................................................................................. 3
SECURE 2.0 Act Changes May Affect Upcoming Payrolls......... 3
IRSAC Issues 2024 Annual Report.................................................... 5
State Unemployment Insurance Taxable Wage Bases for 2025...6
IRS Shares Information About IRIS, FIRE for Upcoming Filing
Season. ..............................................................................................7
Latest Federal Contractor Minimum Wage Case Causes
More Uncertainty........................................................................... 7
Court Rules Approval of FLSA Settlement Is Unnecessary........ 8
DOL Opinion Letters Answer FLSA, FMLA Questions................. 8
IRS Releases 2025 Tables That Will Be Available in
Publication 15-T. .............................................................................9
Tables Issued for Figuring Amount Exempt From Levy in 2025.... 9
IRS Releases 2024 Form 944 and Instructions.............................. 9
IRS Extends Deadline for TPPs to Fix Incorrect ERC Claims. .....9
Free eBook Answers Top Payroll Questions................................10
E-Verify Contacts Users About Transition to Login.gov...........10
IRS Announces Form 1099-K Reporting Threshold for 2024. ...10
11th Circuit Rules Against Employer That Failed to Provide
Records. ...........................................................................................10
Four States Test e-NMSN Through OCSS.....................................12
DOJ Signs Agreement With Company to Resolve
Immigration Issue.........................................................................12
Employers Can Enroll in IRS eLevy Program to Save Time,
Costs. ................................................................................................12
7th Circuit Rules Travel Time for Overnight Jobs Is
Compensable.................................................................................12
5th Circuit Allows Penalty for Employee Who Would Not
Pay Taxes.........................................................................................13
Employers Must Certify Eligibility of New Hires to
Claim WOTC...................................................................................13
Court Awards Attorneys’ Fees to Employer in IRS Tax Case....14
State and Local Highlights...............................................................15
Payroll Professional Offers IRS Recommendations in IRSAC
Report. ........................................................................................17
PayrollOrg Asks Arizona Attorney General to Maintain EWA
Interpretation. ..........................................................................18
Payroll Management of Tribal Child Support Orders. .........18
