Exempt vs. nonexempt
Whether an employee is exempt from federal overtime depends on the Fair Labor Standards Act tests, including a salary level, a salary basis, and the employee’s job duties. New York sets its own, often higher, weekly salary thresholds for executive and administrative employees.
This is general information, not tax or legal advice — talk with your tax advisor about your own situation.
The FLSA salary level for exempt employees
The Fair Labor Standards Act requires most employees to be paid at least the federal minimum wage and overtime at not less than one and one-half times the regular rate for hours over 40 in a workweek. Some employees are exempt from those minimum-wage and overtime requirements, including certain executive, administrative, and professional employees, if they meet the Department of Labor’s tests.
Those tests generally include a salary-level test, a salary-basis test, and a duties test. Meeting the salary level alone does not make an employee exempt. Exempt employees are not “outside” the FLSA; they are simply not entitled to FLSA minimum wage and overtime when the exemption applies. Other FLSA rules can still apply.
After the 2024 overtime rule was vacated, the U.S. Department of Labor’s salary-levels page lists these earnings thresholds for the executive, administrative, and professional exemption:
- Standard salary level: $684 per week (equivalent to a $35,568 annual salary).
- Highly compensated employees: $107,432 in total annual compensation, including at least $684 per week paid on a salary or fee basis.
The same DOL page lists special salary levels for certain territories and a special base rate for employees in the motion picture industry, and it notes that these earnings thresholds do not apply to certain types of employees, including doctors, lawyers, teachers, and outside sales employees. Confirm the current thresholds on the DOL page before you classify a position.
Source: U.S. Department of Labor, Earnings thresholds for the EAP exemption.
New YorkNew York’s 2026 exempt salary thresholds
New York has its own salary thresholds for overtime-exempt executive and administrative employees. Those state thresholds are usually higher than the federal $684 weekly figure. When both apply, the employee must meet the higher standard that governs the work.
The New York State Department of Labor’s minimum-wage FAQ, opened for this page, states that on January 1, 2026, the state minimum weekly salary for administrative and executive employees ranges from $1,199.10 per week for employees in New York State to $1,275.00 per week for employees who work in Nassau, Suffolk, and Westchester counties and in New York City (any size employer, and fast-food establishments).
The same FAQ notes that if the federal courts continue to block planned federal increases, employers subject to state overtime rules must still pay overtime to executive and administrative employees whose salary is above the federal level but below the New York minimum. Classification also depends on the employee’s duties, not only on salary. Talk with your employment attorney before you treat a position as exempt.
Source: New York State Department of Labor, Minimum Wage Frequently Asked Questions.
How PayNortheast helps with overtime and hours
PayNortheast calculates overtime on the hours you approve, and time and attendance can carry those hours into payroll. Classification decisions — whether a position is exempt or nonexempt — remain yours, with advice from your employment attorney. See time and attendance and full service payroll.
- Overtime calculated from the hours you approve, on every payroll.
- Time and attendance hours carried into payroll.
- A dedicated account manager who knows New York payroll.
Questions employers ask
What is the federal salary level for exemption?
The U.S. Department of Labor lists a standard salary level of $684 per week (equivalent to $35,568 a year), and $107,432 in total annual compensation for highly compensated employees, including at least $684 per week on a salary or fee basis. Salary level is only one part of the test.
What are New York’s 2026 weekly salary thresholds?
According to the NY DOL minimum-wage FAQ, on January 1, 2026 the state minimum weekly salary for administrative and executive employees ranges from $1,199.10 per week in New York State to $1,275.00 per week in Nassau, Suffolk, and Westchester counties and in New York City.
If someone is paid a salary, are they automatically exempt?
No. Being paid a salary is not enough. The employee generally must also meet the salary-level test that applies (federal, and New York when it applies) and the duties test for the exemption. Talk with your employment attorney about a specific position.
Official sources for this page
Every figure and rule on this page comes from the sources below, opened November 13, 2026. Re-check them when a new official publication is posted.
- U.S. Department of Labor, Earnings thresholds for the executive, administrative, and professional exemption — $684 per week ($35,568 a year) and the highly compensated employee total of $107,432.
- New York State Department of Labor, Minimum Wage Frequently Asked Questions — January 1, 2026 weekly salary figures of $1,199.10 and $1,275.00 for executive and administrative employees.
Last updated November 13, 2026. This page does not replace advice from your tax advisor or employment attorney.