Exempt Salary Thresholds by State 2027: Overtime Rules Explained

To be exempt from overtime under the Fair Labor Standards Act an employee must be paid a salary of at least $684 a week, $35,568 a year, and perform executive, administrative or professional duties. That federal figure has not moved since January 1, 2020: the Department of Labor's 2024 rule that would have raised it to $58,656 was vacated by a federal court in November 2024 and formally struck from the regulations on May 15, 2026. Six states set their own, higher floors, and most of them rise on January 1, 2027. California's reaches $72,384, Washington's $92,196 at employers with 51 or more staff, Colorado's about $59,864, Maine's about $47,101, while New York's stays at $1,275 a week downstate because the state's minimum wage is frozen.

This page gives the 2027 figure for each jurisdiction with its source and the arithmetic behind it, the duties tests that matter as much as the salary, the computer professional and highly compensated exceptions, and what to do with an employee who falls below the new line. Everything is as published by October 28, 2026; Colorado's figure is from a proposed order and marked so.

Exempt salary thresholds, 2027

Pennsylvania, Illinois, Oregon and the other states apply the federal $684 figure or their own duties tests without a higher salary floor. Pennsylvania's 2020 regulation that would have raised the state threshold was repealed in 2021 and nothing has replaced it.

The federal threshold and the 2024 rule that died

The Department of Labor's April 2024 rule raised the standard salary level to $844 a week on July 1, 2024 and would have taken it to $1,128 a week ($58,656) on January 1, 2025, with automatic updates every three years. On November 15, 2024 the US District Court for the Eastern District of Texas vacated the rule nationwide in State of Texas v. Department of Labor, holding that the increases displaced the duties test Congress wrote into the statute. The department abandoned its appeal in 2025 and, by a technical amendment effective May 15, 2026, restored the 2019 figures to the Code of Federal Regulations: $684 a week for the standard exemption and $107,432 for the highly compensated employee exemption, with up to 10% of the standard level payable as nondiscretionary bonuses and commissions paid at least annually. Overtime was not on the department's spring 2026 regulatory agenda, so the figures are stable for 2027.

Employers that raised salaries to $844 in July 2024 were not required to cut them back, and most did not. Employers that reclassified staff to non-exempt in anticipation of the January 2025 step can reverse the change, but only if the duties test is met and the employee's state has no higher floor.

State by state

California

Labor Code 515 sets the exempt salary at no less than two times the state minimum wage for full-time employment, which is 2,080 hours. With the minimum wage certified at $17.40 on July 31, 2026, the 2027 figure is $72,384 a year, $6,032 a month, $1,392 a week. The figure does not vary with employer size since the two-tier minimum wage ended in 2023, and local minimum wages do not raise it. California also requires that exempt employees spend more than half their time on exempt duties, a stricter quantitative test than the federal "primary duty" standard, and the salary must be a fixed amount not subject to reduction for quality or quantity of work.

Washington

Washington's 2020 rule phases the threshold up to 2.5 times the minimum wage for every employer by 2028. For 2027 the multiplier is 2.5 for employers with 51 or more employees and 2.25 for employers with 50 or fewer, applied to a $17.73 minimum wage for 40 hours: $1,773 a week ($92,196) and $1,595.70 a week ($82,976.40). The Department of Labor and Industries published the figures with the minimum wage announcement on September 30, 2026. Employee count is measured across the whole company, not the Washington headcount alone. The jump from $77,968.80 is the largest in the table because the multiplier for large employers rose from 2.25 to 2.5 as well as the wage rising.

New York

New York's executive and administrative exemptions require 75 times the applicable minimum wage each week; the professional exemption has no state salary test and follows the federal $684. The 2027 minimum wage increase was blocked by the statutory off-ramp, so the thresholds stay at $1,275 a week in New York City, Long Island and Westchester and $1,199.10 a week elsewhere. If the Legislature adopts the governor's proposed $17.60 and $16.55 rates from March 1, 2027, the thresholds would rise to $1,320 and $1,241.25 on the same date; treat that as a possibility, not a plan.

Colorado

The Colorado Overtime and Minimum Pay Standards Order and its companion PAY CALC Order set the exempt salary at $57,784 for 2026 and index it to the consumer price index each year. The proposed 2027 PAY CALC Order published for comment in September 2026 shows about $59,864; the Division of Labor Standards and Statistics adopts the final order in December. Colorado's threshold applies to the executive, administrative and professional exemptions alike, and the state's highly compensated exemption is 2.25 times the standard threshold.

Alaska

Alaska requires two times the state minimum wage for the first 40 hours of the week. At $14.00 that is $1,120 a week ($58,240); when the minimum wage reaches $15.00 on July 1, 2027 it becomes $1,200 a week ($62,400). A mid-year change means a mid-year payroll adjustment for anyone paid between the two figures.

Maine

Maine sets the threshold at 3,000 times the minimum wage divided by 52 weeks, so a $15.70 minimum wage produces $905.77 a week and $47,100 a year, give or take rounding; the Department of Labor usually publishes the exact figure with its minimum wage notice. Maine's figure is the lowest state floor above the federal one.

The salary is only half the test

Paying above the threshold does not make anyone exempt. The employee must also be paid on a salary basis, meaning a predetermined amount not reduced for the quality or quantity of work in a week where any work is performed, and must meet one of the duties tests in 29 CFR part 541:

• Executive: primary duty is managing the enterprise or a recognized department, customarily directing two or more full-time employees, with authority to hire and fire or whose recommendations carry particular weight.
• Administrative: primary duty is office or non-manual work directly related to management or general business operations, with the exercise of discretion and independent judgment on matters of significance. This is the test most often failed; a job title with "coordinator" or "specialist" in it is not evidence of discretion.
• Learned professional: work requiring advanced knowledge in a field of science or learning customarily acquired by prolonged specialized instruction. Nurses with an RN qualify; licensed practical nurses do not.
• Creative professional, outside sales, computer employee: each with its own test; outside sales has no salary requirement at all.

California adds the more-than-half-time quantitative test, and both California and Washington apply their own definitions rather than importing the federal ones. Improper deductions from an exempt salary, such as docking for a half day absence, can destroy the exemption for every employee in the same job classification under the same manager.

Computer professionals and highly compensated employees

The California computer and physician figures are indexed to the California CPI and published by the Department of Industrial Relations each October. The federal computer rate has not changed since 1996. Colorado's highly compensated figure for 2027 is 2.25 times its standard threshold, about $134,694 if the proposed order is adopted.

What to do with an employee under the line

1. Identify everyone within reach of the new figure before the effective date: anyone exempt and paid under $72,384 in California, $92,196 or $82,976.40 in Washington, $59,864 in Colorado, $47,101 in Maine, or $62,400 in Alaska from July.
2. Raise or reclassify. If the employee rarely works more than 40 hours, reclassifying to non-exempt and paying the same salary plus occasional overtime is usually cheaper than a raise to the threshold. If they regularly work 50 hours, the raise is cheaper. Our overtime calculator and salary vs hourly guide run the comparison.
3. Start timekeeping on day one. A newly non-exempt employee must record hours from the first shift under the new rule; the record is the only defense in a later claim. Our clock in clock out app review covers tools that handle salaried non-exempt staff.
4. Set the regular rate correctly. A salaried non-exempt employee's overtime rate is the weekly salary divided by the hours the salary is intended to cover, times 1.5 for the premium; the fluctuating workweek method is allowed federally but barred in California, Pennsylvania and several other states.
5. Communicate the change as a classification, not a demotion. Employees often read reclassification as a loss of status. Explain that the law sets the line, that pay is unchanged, and that overtime will now be paid.
6. Record the decision. Keep a file note of the duties analysis for every exempt position; the Department of Labor and state agencies ask for it first.

Six mistakes that create overtime liability

• Treating the federal $684 as the floor in California, Washington, Colorado, Maine, Alaska or New York.
• Counting Washington employees only, rather than total headcount, when picking the 51-employee tier.
• Prorating the salary threshold for part-time exempt employees. The threshold is not prorated anywhere; a part-time exempt employee must still earn the full weekly figure.
• Including the value of benefits, housing or discretionary bonuses in the salary. Federally, only nondiscretionary bonuses and commissions count, and only up to 10%; California and Washington allow no bonus credit at all.
• Assuming a high salary alone makes an employee exempt. Outside the federal highly compensated exemption, the duties test applies at any pay level.
• Forgetting the mid-year dates: Alaska on July 1, 2027, and New York if the March 1 proposal passes.

The minimum wage by state 2027 page carries the wage figures these thresholds are built on, and the overtime laws by state page covers the daily overtime rules that apply once an employee is non-exempt.

Key takeaways

• The federal exempt salary threshold is $684 a week, $35,568 a year, for 2027. The 2024 increase was vacated in November 2024 and removed from the regulations on May 15, 2026; the highly compensated threshold is $107,432.
• California's threshold rises to $72,384 on January 1, 2027 (two times a $17.40 minimum wage); its computer professional rate is $61.03 an hour or $127,108.34 a year.
• Washington's rises to $92,196 at employers with 51 or more employees and $82,976.40 at 50 or fewer, measured by total company headcount.
• New York's stays at $1,275 a week downstate and $1,199.10 upstate because the 2027 minimum wage increase was blocked; Colorado's proposed figure is about $59,864; Maine's about $47,101; Alaska's rises to $62,400 on July 1, 2027.
• Salary is half the test. The employee must also be paid on a salary basis and meet an executive, administrative or professional duties test; California requires more than half of working time on exempt duties.
• Thresholds are never prorated for part-time work, and California and Washington allow no bonus credit toward them.
• For an employee under the line, compare a raise against reclassification using actual hours worked, and start timekeeping on the effective date.