Department of Labor Weighing Overtime Rule Changes, But No Formal Proposal at this Time

ANCOR is closely monitoring reports that Labor Secretary Marty Walsh expressed to Congress the need to increase the salary threshold at which employees can be exempt from overtime payment. ANCOR supports an increase in the federal hourly minimum wage paired with commensurate funding for Medicaid, so that disability providers can comply with wage laws and avoid unintended consequences to the stability of disability supports. It is important to note that while the reporting shared below by Bloomberg Law shows that the Department of Labor is invested in this issue, no formal proposal to change the rule has been issued at this time. At this point, this discussion reflects internal deliberations in the Department. Should a formal proposal be issued, it would have to follow the time-consuming regulatory process including notice to the public, opportunity for public comment, review by the Administration and issuance of a final rule with a final opportunity for comment.

“Labor Secretary Marty Walsh defended the Biden administration’s efforts to repair a recovering economy in House testimony Wednesday, fielding tough questions from Republicans on expanded unemployment benefits while delighting Democrats by teasing out his worker-focused agenda.

[…]

Walsh then previewed a measure under consideration that could give more workers access to time-and-a-half overtime pay.

The department is reviewing whether to update the salary threshold below which workers are eligible for overtime pay, Walsh said. The current annual overtime eligibility salary cutoff, of about $36,000, is ‘definitely’ too low, he told the panel.

“Do you have any plans to revisit this issue and re-regulate in this area?” Rep. Mark Takano (D-Calif.) asked Walsh.

”We’re currently right now doing that, reviewing that regulation,” he responded. “Literally, as we speak, we have people at the Department of Labor working on that.”

The administration has yet to declare a firm commitment to revive an Obama-era initiative that aimed to significantly lift the overtime salary level. President Joe Biden indicated he would make it a priority in his campaign platform.

Walsh said his agency will consider revising the existing rule to provide automatic increases to the salary level. The threshold was frozen by the current regulation, issued during the Trump administration.

[…]

Under former President Barack Obama, the department issued a rule to boost the cutoff to $47,500 per year with regular updates every three years thereafter, which would’ve made some 4 million workers newly eligible for overtime. That measure was struck down in court in 2016 and never took effect.

Walsh provided no other details on what might be in store. He didn’t reveal a timeline for the review.”