06/29/2017

Labor Department Moves to Revise Overtime Rule

The agency may move to scale back the on-hold Obama-era rule expanding overtime eligibility

The Labor Department signaled this week that it may move to scale back the Obama-era rule expanding overtime eligibility that has been on hold for months.

The department on Tuesday sent a formal Request for Information on the rule to the Office of Management and Budget (OMB). Once OMB reviews the request and it’s published, the public will have a chance to submit comments on the rule, which would more than double the salary at which employees must be paid overtime, from $23,660 to about $47,500.

Earlier this month, Labor Secretary Alexander Acosta said he planned to seek more input on the rule, which was blocked by a federal judge in Texas before it was supposed to take effect on Dec. 1, 2016. The injunction was granted at the request of 21 states, the American Society of Association Executives (ASAE), the U.S. Chamber of Commerce and other like-minded organizations that challenged the DOL’s authority to double the salary limit that determines which workers should be eligible for overtime pay.

ASAE has emphasized that it is not against increasing the overtime salary threshold, but that creating a “one-size-fits-all” salary threshold for overtime eligibility across the country – inconsiderate of cost of living differences – would not be workable for many employers and, in fact, would harm many affected employees as well.

Acosta told Congress earlier this year that an update to the overtime rule might be warranted, but that he had “serious questions” about the previous administration’s efforts to double the salary threshold. That “goes far beyond a cost of living adjustment,” Acosta said. He went on to say that an inflation-adjusted threshold would be about $33,000.

Before the Trump administration took office, DOL appealed the injunction blocking the overtime rule. The DOL’s reply brief on appeal is due June 30; most expect the DOL to withdraw the appeal this week and propose a new version of the overtime rule following the public comment period on its Request for Information.

This article was provided to OSAE by The Power of A and ASAE's Inroads.