Skip to content
overtime regulations image
National Auto Dealers Association (NADA)Oct 24, 20242 min read

NADA Issues Driven Guide on New Rules Defining Overtime Exemptions

NADA released its updated edition of A Dealer Guide to Federal Wage and Hour, Child Labor, and Wage Discrimination Compliance (Driven Guide, LOG-IN REQUIRED). This revised edition updates and replaces the former Driven Guide.

The updates include the final rule the U.S. Department of Labor (DOL) published on April 23, 2024, that raises the minimum annual salary threshold for executive, administrative, professional, outside sales, and computer employees to classify those employees as exempt from overtime rules under the Fair Labor Standards Act (FLSA).

 

Prior

Started on
July 1, 2024

Starting on
January 1, 2025

Minimum Annual
Exempt Salary

$35,568

$43,888

$58,656

Highly Compensated Employee Salary

$107,432

$132,964

$151,164

This minimum annual salary threshold will automatically increase every 3 years, starting in July 2027, based on a cost-of-living index. Also, nondiscretionary bonuses or commissions may satisfy up to 10 percent of the minimum annual salary threshold.

Additional Details: 

  • The new rule’s dramatic increase in salary thresholds will require dealers to reclassify some exempt employees as non-exempt and require justification for classifying some employees as non-exempt.
  • In addition to the updates related to the new salary threshold, the Driven Guide provides an overview of some basic requirements for new-car and-truck dealers to comply with the federal wage and hour, child labor, and wage discrimination laws. The Driven Guide covers topics including:
    • Minimum wage
    • Overtime
    • Exemptions
    • Salesmen and commission employees
    • Recordkeeping
    • Equal pay and compensation discrimination

The new overtime rule is in effect for employers. However, questions remain regarding the rule's viability in the face of legal challenges. Multiple lawsuits are pending in federal courts challenging DOL’s final rule. The federal courts may issue decisions on these legal challenges before the overtime rule’s second deadline on January 1, 2025.

NADA is providing a webinar, A Dealership Crash Course in Minimum Wage and Overtime Exemptions, on November 19, 2024, at 1:00 EST. To learn more about this rulemaking and other wage and hour exemptions, register here.  

Additional guidance on the revised rule is available below:

Please Note: If you have questions, NHADA has several partners who offer legal services to members, including:

Of the five partners listed above, three firms have volunteered their expertise through the NHADA Employment Law Hotlines. This allows for free introductory phone calls on the topic of employment law.

RELATED ARTICLES