Here’s Greg Bahnsen’s take:
Dispensationalists will say that, in the end, salvation in the Old Covenant was by the grace of God through faith. However, they also say that, hypothetically, salvation was offered to men on the basis of their keeping the law perfectly — that God extended an invitation to legalism — in the Old Covenant. By contrast, they say, the New Covenant knows no legalism, even hypothetically; salvation is purely by grace without any consideration of works whatsoever. This viewpoint displays a very disturbing and unbiblical understanding of God’s character and sovereignty. According to Covenant theology, salvation has never been by works, even hypothetically; it has always been proclaimed on the basis of God’s grace. And this grace has always called for the response of faithful obedience on the part of God’s people — in both of Old and New Testaments. Thus dispensationalists have misconstrued God’s work of salvation and (again) the newness of the New Covenant.