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Big changes and potentially higher staffing costs are in store for thousands of businesses and nonprofits in Southwest Florida and around the country if new U.S. Department of Labor overtime rules go into effect as planned July 1.  

The new rule would make millions of currently exempt (salaried) workers eligible for overtime, but legal challenges to be decided early next week could delay or derail the DOL plan. A hearing is scheduled for June 24 in the U.S. District Court Eastern District of Texas regarding two lawsuits, including one brought by Texas Attorney General Ken Paxton. 

The current overtime pay threshold is $684 per week, or $35,568 per year. If the legal challenges are not successful, on July 1 the new rule would mean salaried employees earning less than $844 per week, or $43,888 per year, would be eligible for overtime pay. In January 2025, most salaried employees who make less than $1,128 per week, or $58,656 per year, would become eligible for overtime pay, according to the DOL. The salary threshold would then update every three years. 

How can employers prepare? 

What does this mean for employers in Southwest Florida, especially small to mid-sized businesses, and how should they prepare? 

Estero attorney Chris Wegner of Wegner Law PLLC, who advises companies on a range of employment and labor law issues, said he is telling clients to talk to their accountants to determine how the increased pay rule could impact their business. 

“The accountants are going to be able to say what the additional costs are going to be and what you’re going to need to do to prepare for it,” Wegner said. “You want to go to your accountants because they’re the ones who can do the math. It’s better handled by the accountants who are going to have kind of the boots on the ground– type understanding of both the client and the laws.” 

Wegner provided a memo he is sending to clients covering the possible effects of the new rule, including increased labor costs and payroll expenses with more employees eligible for overtime, the administrative burden related to improving time-tracking systems, operational adjustments covering workforce reorganization and possible job reclassification, the need for clear communication and change management strategies to minimize confusion or dissatisfaction among employees and budget adjustments. 

“Companies will need to reevaluate budgets to account for increased payroll expenses,” Wegner said in his memo to clients. “This might involve cutting costs in other areas or increasing prices for goods and services. Smaller profit margins could result from higher labor costs, especially for businesses with tight budgets.” 

Wegner said in the memo that “industries prevalent in SWFL, such as tourism, hospitality and service sectors, may be particularly affected due to their reliance on lower-wage and variable-hour employees. Agricultural businesses, which are significant in SWFL, might face challenges due to the seasonal nature of work and the need for flexibility in employee hours.” 

And despite the legal challenge to the rule, Wegner said he is advising his clients to proceed as if the change will happen. 

“Although the challenge has a better-than-average chance of succeeding, there is still a pretty good chance that the rule will go into effect as planned,” he said. 

How can employees prepare? 

While the burden is on employers to ensure they abide by the rule if it goes into effect, what do salaried employees who fall into the affected categories need to know? 

Orlando-based attorney Ryan Morgan, chair of the employment rights group at Morgan & Morgan law firm, said he thinks exempt workers should check with their employers if they have not yet heard anything about how the new rule will be handled, even though those conversations about compensation can be uncomfortable. 

“People get uncomfortable bringing things like this to their employer and asking about pay and all this, but [they can] just say, ‘Do you know what the company’s going to do? Am I going to start getting overtime July 1?’” Morgan said. 

He said if a salaried employee who meets the threshold hasn’t heard from their employer by July 1, if the rule goes into effect, he recommends that they track their time themselves in case the employer is not set up to do so. 

Hopefully the employer is doing it, but for a lot of salaried folks, employers do not track time,” Morgan said. “The employee can do it, and it doesn’t have to be some fancy down-to-the minute tracker. There are plenty of tools out there on the internet to help, but even just writing it down on a piece of paper, putting it into your phone: Monday, I came in at 8:15, took lunch from about 12 to 12:30, and then I went home at 6.” 

Morgan said it is important for employees who may need to ask their employers about their status to know that the overtime rule includes an anti-retaliation provision included within the law. 

“There are protections there for people to ask those questions,” Morgan said. “As this unfolds, if you are asking these types of questions and there’s any sort of back-and-forth or any sort of, again, uncomfortable situation, take notes, write down what happened, send yourself a text message, put a note in your phone to kind of record what’s going on. ‘I spoke to my boss John on Monday asking whether I was going to be paid overtime. And then John got back to me Tuesday and said, Nope, sorry, the company can’t afford it. And basically, told me, you know, don’t ask for it.’   

“Just keep that note.” 

Copyright 2025 Gulfshore Life Media, LLC All rights reserved. This material may not be published, broadcast, rewritten or redistributed without prior written consent.

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