Updated: October 2026
Overtime eligibility for 2027 depends on two sets of rules. The federal salary threshold for exempt employees stays at $684 per week, while several states set higher salary floors and some require daily overtime. This guide covers where each stands for 2027 and what employers should check before January 1.
What Employers Should Know About Overtime and Exemptions
When Overtime Is Owed
Under the federal Fair Labor Standards Act (FLSA), non-exempt employees must be paid at least one and a half times their regular rate for hours worked over 40 in a workweek. Most states follow the same 40-hour weekly rule, and a few also require overtime based on hours worked in a single day.
Who Can Be Exempt
An employee is exempt from overtime under the executive, administrative or professional exemptions only if all three of these are met:
- Salary basis: The employee is paid a predetermined, fixed salary that doesn't drop because of variations in the quality or quantity of work.
- Salary level: The salary is at least the minimum set by federal law, or by state law where the state sets a higher floor.
- Duties: The employee's primary duties are executive, administrative or professional as the rules define them.
Failing any one of the three means the employee must be paid overtime. Job titles don't decide exempt status.
The Federal Salary Threshold for 2027
The federal minimum salary for the executive, administrative and professional exemptions is $684 per week ($35,568 a year), and the highly compensated employee threshold is $107,432 a year.
The Department of Labor's 2024 rule would have raised the threshold to $844 per week in July 2024 and $1,128 per week in January 2025. Federal courts in Texas vacated that rule, and on May 15, 2026, the Department published a final rule restoring the 2019 regulations and their $684 threshold (Federal Register). No federal increase is scheduled for 2027.
Where a state's salary floor is higher than $684 per week, employers in that state must meet the state level.
States With Daily Overtime Rules
In these states, overtime can be owed based on hours worked in a single day as well as hours in a week:
- California: Overtime after 8 hours in a workday and double time after 12 hours, with special rules for the seventh consecutive workday.
- Alaska: Overtime after 8 hours in a day or 40 hours in a week, for employers with four or more employees.
- Colorado: Overtime after 12 hours in a workday or 12 consecutive hours, as well as after 40 hours in a week.
- Nevada: Overtime after 8 hours in a 24-hour period for employees paid less than 1.5 times the minimum wage, which is $18.00 per hour (Nevada Labor Commissioner, 2026 bulletin). Employees on an agreed four-day, 10-hour schedule are excepted.
In these states, payroll systems need daily hours, not only weekly totals.
State Exempt Salary Floors for 2027
These states set exempt salary floors above the federal $684 per week. Many are tied to the state minimum wage, so they rise when it does.
| State | 2026 floor | 2027 floor | Status |
|---|---|---|---|
| California | $70,304 a year | $72,384 a year (twice the $17.40 minimum wage for full-time work) | Announced; effective January 1, 2027 |
| Washington, 51 or more employees | $1,541.70 a week ($80,168.40 a year) | $1,773.00 a week ($92,196 a year), 2.5 times the minimum wage | Announced; effective January 1, 2027 |
| Washington, 50 or fewer employees | $1,541.70 a week ($80,168.40 a year) | $1,595.70 a week ($82,976.40 a year), 2.25 times the minimum wage; 2.5 times in 2028 | Announced; effective January 1, 2027 |
| Maine | $871.16 a week | $905.79 a week ($47,101.08 a year) | Announced; effective January 1, 2027 |
| Alaska | $1,120 a week (from July 1, 2026) | $1,200 a week from July 1, 2027 (twice the minimum wage for a 40-hour week) | Set in law |
| Colorado | $1,111.23 a week ($57,784 a year) | Not yet published; adjusted for inflation each year | Pending |
| New York, executive and administrative: NYC, Long Island, Westchester | $1,275 a week ($66,300 a year) | Not yet published | Pending |
| New York, executive and administrative: rest of state | $1,199.10 a week ($62,353.20 a year) | Not yet published | Pending |
New York's minimum wage will not rise on January 1, 2027, because an economic off-ramp in state law was triggered. Its exempt thresholds have historically moved with the minimum wage, so check the New York State Department of Labor for the 2027 figures. New York's professional exemption uses the federal $684 per week.
California's figure applies to most white-collar exemptions; computer professionals have a separate threshold that California sets each year.
Key Steps for Employers Before January 1, 2027
- Compare salaries to the 2027 floors. List exempt employees by state and check each salary against the federal $684 per week and any higher state floor that applies.
- Review duties, not titles. Confirm each exempt employee's primary duties fit an exemption.
- Decide how to handle anyone below the floor. Raise the salary to the new level or reclassify the employee as non-exempt and pay overtime.
- Track daily hours where required. Set up payroll to calculate daily overtime for employees in California, Alaska, Colorado and Nevada.
- Watch for pending figures. Colorado and New York publish their 2027 thresholds later in the year.
FAQ: Overtime and Exemptions in 2027
What is the federal salary threshold for exempt employees in 2027?
$684 per week ($35,568 a year), and $107,432 a year for highly compensated employees. The Department of Labor restored these levels in May 2026, and no increase is scheduled.
Which states require daily overtime?
California, Alaska, Colorado and Nevada, each with its own rules on who is covered and when daily overtime starts.
Which states raise their exempt salary floors for 2027?
California, Washington and Maine have announced higher floors for January 1, 2027, and Alaska's rises on July 1, 2027. Colorado and New York had not published 2027 figures as of October 2026.
What happens if an employee falls below the new threshold?
The employee can't be treated as exempt. Employers must either raise the salary to at least the threshold or reclassify the employee as non-exempt and pay overtime.
Do federal and state overtime rules differ?
Yes. Where state law sets a higher salary floor or requires daily overtime, employers must follow the rule that gives employees more protection.