President Donald Trump’s Department of Labor (DOL) announced that it would not defend an Obama-era rule that has doubled the salary threshold at which employers must provide overtime compensation to employees.
The rule, championed by former President Barack Obama’s DOL, would have raised the salary threshold for workers to qualify as exempt from overtime pay from $455 to $913 per week (or from $23,660 to $47,476 per year). The rule was set to go into effect Dec. 1, 2016, before a federal judge issued a temporary injunction.
U.S. District Court Judge Amos Mazzant questioned the DOL’s authority to raise the minimum salary threshold. In his opinion, Mazzant said that the DOL “exceeded its delegated authority and ignored Congress’s intent by issuing the rule.”
The DOL said Friday that it would not appeal Mazzant’s temporary injunction, meaning that Obama’s overtime rule is likely dead.
Employers applauded the move. Opponents to the rule argued that Obama’s DOL failed to consider regional salary and economic differences in setting the nationwide base pay rate.
“We are grateful to see Secretary Acosta actually listening to the stakeholders in charge of implementing this regulation and taking the time to work with all of those involved to come to an agreement,” Angelo Amador, Executive Director of the Restaurant Law Center, told The Daily Caller News Foundation. “The business industry has repeatedly said we are supportive of discussing changing the overtime threshold, but it must be done in a responsible way.”
Labor Secretary Alexander Acosta told a Senate panel earlier in 2017 that he would consider raiding the maximum salary threshold level to a little over $30,000 in order to keep up with inflation. The new secretary has been applauded for including the wide range of stakeholders that is affected by overtime rules.
“Secretary Acosta has once again proven he is a thoughtful leader who will work in the best interest of the American worker,” Amador told TheDCNF.
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