On February 16, 2017 human resource professionals spoke to a congressional subcommittee, letting them know that it is time to resolve the uncertainty over the Department of Labor’s (DOL) overtime rule.
The overtime rule was scheduled to go into effect on December 1, 2016, but on November 22, 2016, a federal judge in Texas halted the ruling, which would have bumped the federal annual salary threshold from $23,660 to $47,476. The case was forced into the Fifth Circuit Court of Appeals when the DOL sought an appeal.
On February 22nd, the court granted a 60-day extension to the Justice Department’s request for more time for the new administration to figure out where it stands on the issue. This provides the president and the new, unknown labor secretary until May 1st to determine a plan moving forward.
Twenty-one states filed lawsuits against the federal government in order to block the DOL’s overtime rule, citing a violation of the Tenth Amendment. Unfortunately, many companies had already upped their employee’s salaries above the threshold or switched them to an hourly wage.
How should you respond:
1. If you haven’t made any changes to your employee’s paycheck, it is a good time to wait and see what happens.
2. Employers that have already put the payroll changes in place, should seriously consider leaving things the way they are. There is no greater way to destroy morale than by taking back a raise.
3. Keep your eyes and ears open for the latest information. Visit the United States Department of Labor (www.dol.gov) or the Society for Human Resource Management (www.shrm.org)