Overtime Rule Going Back to Court

November 1, 2017

The Trump Administration has indicated that it is challenging a U.S. District Court ruling that had invalidated the Obama overtime rule. Labor Department officials have made clear that they are not suing to restore the Obama-era rule, but only to preserve the authority of the Labor Secretary to shape overtime standards.

The Obama Administration had promulgated a rule that would have effectively made almost all workers making under $47,476 per year eligible for overtime, regardless of their managerial responsibilities or other duties. NSBA was sharply critical of that new rule, which did to properly account for the unique circumstances of smaller workplaces or locality-based pay variables.

The courts issued a temporary stay of the overtime rule in December 2016, just before it was scheduled to go into effect. In August of this year, that stay was made permanent—effectively dismantling the new rule. The Trump Labor Department is now working on its own reshaping of overtime rules, and appears to be initiating this appeal in order to bring clarity to the ability of the Labor Secretary make such changes.