If you read a headline this year about the federal overtime salary threshold dropping, and you pay employees in New York, that headline doesn’t help you as much as you’d think. Here’s why.

What Actually Happened Federally

Back in May, the Department of Labor’s Wage and Hour Division restored the older, lower federal salary threshold for the “executive, administrative, and professional” overtime exemption — $684 a week, or $35,568 a year. That undoes a 2024 rule that would have pushed the threshold considerably higher. Courts in Texas vacated that 2024 rule, and the DOL followed by pulling it out of the federal regulations entirely.

So federally, as of right now, you can classify an employee as exempt from overtime at a salary as low as $35,568 — assuming they also meet the duties test, which is a separate question I’m not covering here.

That’s the number making the rounds. It is not the number that applies to you if your business is in New York.

New York Set Its Own, Higher Number — Years Ago

New York never waited on the federal government to set its own salary threshold for the executive and administrative exemptions. It has its own, and it’s updated on its own schedule, regardless of what happens in Washington.

For 2026:

  • NYC, Nassau, Suffolk, and Westchester (that’s Amityville and effectively all of Long Island): $1,275 a week, or $66,300 a year.
  • The rest of New York State: $1,199.10 a week, or $62,353.20 a year.

Both numbers went up again from 2025, when the Long Island threshold was $64,350 and the rest-of-state threshold was $60,405.80. New York’s minimum wage keeps climbing, and the exempt salary threshold climbs with it.

There’s one exception worth knowing: New York doesn’t set its own threshold for the professional exemption specifically — that one still falls back to the federal number, $35,568. Executive and administrative exemptions are the ones with the state-specific, much higher bar.

Where Business Owners Get This Wrong

I see this mistake most often with a manager or office lead who’s been salaried since the business was small — say, $50,000 a year, classified as exempt because “they’re basically management.” If that employee works in Amityville, Nassau, or Suffolk County, $50,000 is nowhere near the $66,300 threshold. Federal law dropping to $35,568 doesn’t rescue that classification. New York’s number is the one that governs, and it was never close.

Run the math on what that actually costs if the IRS — or more likely here, the New York Department of Labor — reclassifies that employee as non-exempt retroactively: back overtime for every week over 40 hours, going back as far as six years under New York’s statute of limitations for wage claims, plus liquidated damages that can double the amount owed. A manager working an honest 45-hour week at $50,000 a year, misclassified for three years, can turn into a five-figure liability before you’ve paid a lawyer to sort it out.

Not sure if your salaried employees actually clear New York's threshold — or meet the duties test on top of it? Schedule a call and we'll go through your payroll classifications together before it's a Labor Department problem instead of a payroll adjustment.

What to Actually Do About It

Pull your list of salaried, exempt employees and check two things for each one: does their salary clear $66,300 (Long Island / NYC metro) or $62,353.20 (rest of state), and do their actual day-to-day duties meet the executive or administrative test — not just their job title. A title alone has never been enough to justify an exemption, in New York or federally.

If someone’s under the threshold, you have two real options: raise their salary to clear it, or reclassify them as non-exempt and start tracking and paying overtime. Both have real cost. Neither is riskier than leaving a misclassified employee on the books and hoping nobody asks.

This is also a good moment to check your overall labor cost picture — New York’s minimum wage and salary thresholds have both been climbing on the same annual schedule, and I’ve written separately about what the Long Island minimum wage increase costs a typical small employer.

Running payroll across state lines, or just want a second set of eyes on your exempt classifications before an employee (or a lawyer) asks the question first? Book a call. This is a cheap fix now and an expensive one later.

This post is for informational purposes only and isn't a substitute for legal or tax advice specific to your situation. Salary thresholds and labor law are subject to change; verify current figures at dol.ny.gov and dol.gov. Reach Geiger Tax & Accounting at (631) 532-5622 or schedule a call for guidance specific to your business.