New Overtime Rule May Go Into Effect Before the Election

On March 14, 2016, the Department of Labor (DOL) sent the Office of Management and Budget (OMB) its revisions on the proposed overtime rule that purports to change which workers are eligible for overtime pay. The proposed rule was released for public comment on June 30, 2015, resulting in over 250,000 comments, about three times more than were submitted the last time the overtime rules were changed. That version of the rule can be found online at: http://webapps.dol.gov/FederalRegister/PdfDisplay.aspx?DocId=28355. With the DOL sending its revisions to the OMB, once a review period has ended, the final review could be published in the Federal Register as early as this summer. We believe that the rule will be published in July with an effective date in September, or published in September with an effective date just prior to the November election.

The Obama administration is working to get this rule implemented to protect it from being withdrawn if a Republican wins the White House in November. The Congressional Review Act allows a joint resolution from both houses of Congress and the President to undo laws and rules passed during the final six months of the previous administration. Though this act has only been invoked once, proponents of the new overtime rule are pushing to have it go into effect as soon as possible to prevent the application of the Congressional Review Act.

In the meantime, employers are urged to begin preparations now for the rule’s implementation, as under its current revisions, more employees will be considered eligible for overtime. We urge everyone to prepare now for the implementation of these new rules rather than waiting. More employees will be considered eligible for overtime as the salary threshold rises. If you would like to discuss the proposed rules and the best way to implement them, feel free to contact us.