Overtime · 2026 rules
The salary threshold for exempt employees, federal and state
Below this salary, a white-collar employee is owed overtime whatever the job duties. Several states set the line well above the federal figure.
Checked by Radif Partners · Editorial policy · How we calculate
The federal salary threshold for exempt executive, administrative and professional employees is $684 a week in 2026, which equals $35,568 a year, $1,368 every two weeks or $2,964 a month. An employee paid less is owed time and a half after 40 hours, whatever the job title or duties. 6 states on file set a higher level of their own: Washington at $1,541.70 a week, California at $1,352 a week, New York at $1,199.10 a week, Alaska at $1,120 a week, Colorado at $1,111.23 a week, Maine at $845.21 a week. Where a state level is higher, it decides the overtime question under state law. Washington, California and Alaska tie the level to the state minimum wage, so it rises each time that rate does. Highly compensated employees face a separate federal test at $107,432 a year, and computer employees can be exempt when paid at least $27.63 an hour. Passing the salary test is never enough on its own: the duties must also be exempt. The calculator below converts your state level into an hourly figure for your actual hours.
The exempt salary level in your state, as an hourly rate
Exempt level in California
$70,304 a year
| Per week | $1,352.00 |
| Hourly at 50.0 h a week | $27.04 |
| Federal level | $684 a week |
| Highly compensated (federal) | $107,432 |
The federal level and where it stands in 2026
The figure comes from section 541.600 of the federal regulations: a salary of not less than $684 per week, paid on a salary basis, exclusive of board, lodging or other facilities. It has applied since January 1, 2020. A 2024 rule that would have raised the level in two steps no longer appears in the regulation; the text as amended on May 15, 2026 reads $684, and that is the level in force. The weekly amount may be paid over longer periods, which gives $1,368 biweekly, $1,482 semimonthly and $2,964 monthly, but the shortest pay period that qualifies is one week. Up to ten percent of the level can be met with nondiscretionary bonuses or commissions paid at least once a year.
The same $684 applies to the executive, administrative and professional exemptions and to salaried computer employees. Outside salespeople have no salary requirement, and teachers and practicing doctors and lawyers are exempt without one. The highly compensated employee test sits on top: $107,432 in total annual compensation, of which at least $684 a week must be salary, plus at least one exempt duty performed customarily and regularly.
States with a higher line
The table lists every state on file that requires more than the federal level, the weekly and yearly amounts, and how the level compares with the state minimum wage for a 40-hour week.
| State | Weekly level | Yearly equivalent | Times the state minimum wage x 40 h |
|---|---|---|---|
| Washington | $1,541.70 | $80,168 | 2.25 |
| California | $1,352 | $70,304 | 2.00 |
| New York | $1,199.10 | $62,353 | 1.87 |
| Alaska | $1,120 | $58,240 | 2.00 |
| Colorado | $1,111.23 | $57,784 | 1.83 |
| Maine | $845.21 | $43,951 | 1.40 |
Washington, California and Alaska write the level as a multiple of the state minimum wage for full-time work: twice the minimum wage for 40 hours in California and Alaska, and 2.25 times in Washington. Every minimum wage raise therefore lifts the salary a manager must earn to stay exempt, without any separate announcement. New York, Colorado and Maine publish a dollar figure instead, set by statute, by wage order or by an annual adjustment. New York has two levels, the one in the table for most of the state and a higher one for New York City, Long Island and Westchester. Washington changes its multiple in 2027, with a higher one for employers with more than 50 employees.
Because of that link, the 2027 level is already known where the next minimum wage is: California moves to $1,392 a week, or $72,384 a year, from January 1, 2027; Alaska moves to $1,200 a week, or $62,400 a year, from July 1, 2027. A salaried employee paid between the current and the coming level should expect either a raise or a switch to overtime pay on that date.
What the threshold means per hour
The salary test sets a weekly amount, not an hourly one, and exempt employees are often expected to work long weeks. At the federal level, a 50-hour week works out to $13.68 an hour. That is below the general minimum wage of 22 jurisdictions on file, which shows how low the federal line has become relative to state wage floors. In Washington, the same 50 hours at the state level give $30.83 an hour. The calculator above does this conversion for your state and your real hours. It is a useful sanity check: if your salary divided by your hours lands near the minimum wage, the exemption is worth questioning.
When a salary falls below the line
An employee paid under the applicable level is non-exempt, full stop. The duties no longer matter. The employer then has two lawful choices: raise the salary to the level, or keep it and pay overtime. In the second case the salary is converted into a regular rate, the weekly salary divided by the hours it is meant to cover, and every hour past 40 earns at least 1.5 times that rate. A salary of $650 a week for 40 hours gives a regular rate of $16.25, so a 50-hour week owes $243.75 in overtime on top. Expect the employer to start recording your hours, since overtime cannot be paid without them.
Some reclassifications go the other way: an employer raises a salary just above the level to make a role exempt. That only works if the duties qualify too. The exempt vs non-exempt guide sets out the executive, administrative, professional, computer and outside sales tests, with the regulation's own wording.
The gap between federal and state levels over a year
The differences are large enough to change hiring decisions. Over a full year, the state level asks for $44,600 more than the federal line in Washington, $34,736 more than the federal line in California, $26,785 more than the federal line in New York, $22,672 more than the federal line in Alaska, $22,216 more than the federal line in Colorado, $8,383 more than the federal line in Maine. A national employer with offices in several states therefore cannot use one salary floor for its exempt roles: a project coordinator who is properly exempt in a federal-level state may be owed overtime in a higher-level state for the same work at the same pay. Remote work adds a twist, since the state rule generally follows the place where the employee works, not the head office.
Deductions that can break the salary test
A salary that meets the level on paper can still fail if the employer docks it. The full predetermined amount must be paid for any week in which the employee does any work, and pay cannot be cut because work was not available or because the business closed for a day. Only a few full-day deductions are allowed, for personal absences, for sickness under a bona fide plan, for major safety violations and for written-policy disciplinary suspensions. Docking pay for a partial day, a late arrival or a slow afternoon is the classic way an exempt salary turns into a non-exempt one.
Checking your own salary
Find the level that applies where you work, federal or state, whichever is higher. Divide your annual salary by 52 and compare. Remember that the test looks at the salary paid each pay period, not at an annual total that includes a large year-end bonus, except for the limited bonus credit and the separate highly compensated test. If you fall short and work more than 40 hours, keep a record of your hours. The state labor agency or the Wage and Hour Division takes overtime claims and decides them on the payroll records; an employment lawyer can look at a case where both the salary and the duties are disputed. The overtime laws by state page shows when overtime starts in each state.