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Judge Makes Final Decision on Overtime Final Rule

A conclusion has finally been reached regarding the Overtime Final Rule, which was the Obama administration's attempt to dramatically change salaried worker overtime rules. The Overtime Final Rule was of great interest to employers because it would be the most costly change to the Fair Labor Standards Act (“FLSA”) in a generation.

Background 
The FLSA currently entitles salaried workers earning less than $23,660 annually to overtime pay. The Obama administration's Overtime Final Rule would double the threshold to $47,476. It was estimated that this change would entitle more than 4 million existing salaried workers to overtime pay. Just days before the law was set to take effect on December 1, 2016, U.S. District Judge Amos Mazzant signed a temporary injunction. To learn more, read our blog about the Overtime Final Rule update or visit the Department of Labor website.

The Latest Ruling
On August 31, 2017 Judge Mazzant granted a summary judgment against the Department of Labor concluding that the Overtime Final Rule was invalid. The court ruled that the 100% increase was outside of the Department’s authority.

What's Next?
With the Final Overtime Rule off the table, there has been speculation in the media about the current Department of Labor and how they might want to revisit this issue. The current overtime threshold has been in place for over a decade so some are arguing that a smaller increase to the overtime threshold should still be pursued.
 
Over the past year we have had regular calls from employers preparing for the possibility of the Overtime Final Rule and we've enjoyed sharing how Virtual TimeClock is a great solution for tracking hourly and salary employee hours. These interesting conversations led to this recent article on reasons employers may want to track salary worker hours with Virtual TimeClock.