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Fate of federal overtime rule still under review

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July 12, 2017
In a June 30 brief filed in the Fifth Circuit Court of Appeals in New Orleans, the U.S. Department of Labor said it wants salary level to count in deciding who is eligible for overtime pay.  However, the agency does not want to set the maximum pay a worker can get and still qualify. A new overtime rule reached during President Obama's administration raised the salary level for the white collar exemptions from $23,660 to $47,476.
 
The rule that was set to go into effect Dec. 1, 2016 was blocked when 21 states filed a lawsuit in U.S. District Court in Eastern Texas.  On Nov. 22, 2016, U.S. District Judge Amos Mazzant ruled that the Department of Labor exceeded its authority by focusing on salaries to determine whether employees are eligible for overtime pay or not. He stated that the department should instead examine the duties that employees perform to determine if they qualify as "executive, administrative or professional" workers who are exempt from overtime requirements.
 
New Labor Secretary Alex Acosta, who took the post in April, has suggested the decision may have called into question whether his agency could use a salary level at all.  He told a Senate panel this year that he'd consider raising the maximum salary level from nearly $24,000 to a bit more than $30,000 to keep up with inflation. The idea is that workers making less than the threshold would be eligible for time-and-a-half pay when they work more than 40 hours a week.
 
In its June 30 brief, the Labor Department did not endorse the Obama administration's salary maximum and is seeking public information on a new threshold.  The administration asked the court to "address only the threshold legal question of the department's statutory authority to set a salary level, without addressing the specific salary level set by the 2016 final rule."

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