Commercial Fixed Wing
Flight Crew Air Transport Pilot (ATP); Flight Crew Instrument; Flight Crew Multiengine
Flight Crew Last 90 Days 41; Flight Crew Type 7500
Situational Awareness; Other / Unknown
Deviation - Altitude Overshoot; Deviation / Discrepancy - Procedural Clearance
Air Traffic Control Provided Assistance; Flight Crew Returned To Clearance
Environment - Non Weather Related; Human Factors
ATC initially cleared flight to 5;000 feet for the departure and this altitude was briefed for the departure.  ATC changed the altitude to 2;500 feet on the taxi and the crew dialed the new altitude into the FMS.  FO failed to level off at 2;500 feet and topped out at 3;000 feet before correcting back down to 2;500 feet.  ATC gave us a vector away from traffic eight miles ahead of aircraft and gave us a climb up to 15;000 feet.  Neither crew member remembers hearing the 1;000 foot prior altitude alert.  It should not have been inhibited for a flaps 1 condition.  Altitude alert functioned normally on next level off.  Crew must have missed the alert due to flaps up call-out.  The FO had only flown 10 times in the last 90 days with 10 landings. The crew should have reviewed the field elevation versus the level off altitude and briefed that the level off would occur immediately after flap retraction.   FO needs to be extra vigilant with flight performance during this time of low flight hours.
We were climbing out of ZZZ and were cleared to level at 2;500 feet. We had briefed accordingly so there was no change. As we climbed out I made the required 1000-foot call and as we were approaching 2;500 feet; I realized he's not leveling off. I stated we were cleared to 2;500 feet level off. He hesitated then realized his mistake and began to level off. We went approximately 300 feet high; so 2;800 feet. Before I could notify ATC we were told to turn 30 degrees left and continue our climb to 15;000 feet. The rest of the flight was fine.We both have not flown as much as we would have at this point in time of the year. I believe he had six trips a month for the last three months. I should have been quicker to realize he was not going to level; and should have taken the aircraft when I realized the mistake and we would not have violated the assignment.
Air carrier flight crew reported experiencing an altitude deviation during departure. Flight crew did not hear the 1;000 feet altitude alert.