New York State Employers Face Minimum Wage and Salary Level Increases

Overtime exempt limit and minimum wage to increase under changes

New York State employers face upcoming increases in the minimum wage and salary threshold for both the salaried employee overtime exemption and certain other exemptions under the New York Labor Law. Employers should familiarize themselves with these upcoming changes to ensure they understand what is required to maintain compliance with New York’s minimum wage and salary requirements.

Minimum Wage Increase

On January 1, 2024, the minimum wage in New York State will increase to $16 per hour in New York City and the counties of Nassau, Suffolk and Westchester, and increase to $15 per hour in all other parts of the State. The minimum wage will then increase by $0.50 in 2025 and another $0.50 in 2026, and increase thereafter at a rate determined by the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) for the Northeast Region.

Overtime Exempt Salary Threshold

On October 4, 2023, the New York State Department of Labor (NYSDOL) published proposed regulations increasing the salary threshold for exempt executive and administrative employees under the New York Labor Law. Under the proposed regulations, the New York State salary threshold for exempt executive and administrative employees would increase in 2024 as follows:

• New York City, Westchester, Nassau and Suffolk Counties
  From $1,125.00/week to $1,200.00/week ($62,400.00/year)
• The Rest of New York State
  From $1,064.25/week to $1,124.20/week ($58,458.40/year)

The comment period for the proposed regulations ended on December 4, 2023. It is expected that the NYSDOL will announce shortly the adoption of the proposed regulations as well as an effective date for implementation of the increased salary thresholds. The NYSDOL has not yet identified an effective date for the salary threshold increases. Upon the proposed increase taking effect, employers will have to increase the salary of executive and administrative employees accordingly to continue to treat them as exempt from overtime under New York State law.

Professional employees are not subject to the New York State salary threshold requirements and those employees remain subject to the federal exempt salary threshold, which currently is $684.00/week ($35,568.00/year). However, the U.S. Department of Labor proposed regulations on August 30, 2023, which would increase the federal salary threshold for executive, administrative and professional employees to $1,059.00/week ($55,068.00/year).

Other New York Labor Law Exemptions

In addition to establishing a salary threshold for the executive and administrative employee overtime exemption, New York Labor Law § 190(7) establishes a separate salary threshold (currently $900.00/week) for executive, administrative and professional employees to be exempt from certain other provisions of the New York Labor Law. For example, executive, administrative and professional employees who meet this separate salary threshold are exempt from the following New York Labor Law requirements:

• § 191(d) – paying “a clerical and other worker” “not less frequently than semi-monthly”
• § 192 – having to obtain “advance written consent” to pay wages via direct deposit

The salary threshold under § 190(7) is scheduled to increase from $900.00/week to $1,300.00/week on March 13, 2024. This is lower than both the current and proposed New York State exempt salary thresholds. Thus, as of March 13, 2024, an executive, administrative or professional employee not paid at least $1,300.00/week will have to be paid at least semi-monthly and will have to provide written consent for direct deposit of wages, even if the employee is paid the current or proposed New York State overtime exempt salary threshold amount.