As readers may recall, the Obama administration issued new Fair Labor Standards Act (“FLSA”) overtime rules that required employers to pay overtime to employees earning less than $913 per week, which amounts to $47,476 annually. This new rule, scheduled to have taken effect on December 1, 2016, more than doubled the existing threshold of $455 per week. However, business groups and certain states challenged the new rule, and a federal judge issued a nationwide injunction. The U.S. Department of Labor (“DOL”) appealed, but the Trump administration sought three extensions to file a reply brief with the appellate court, with the final extension expiring on June 30, 2017. On June 26, 2017, the DOL filed a Request for Information regarding the final overtime rule, indicating that it will undergo a new rulemaking process.
The rulemaking process is likely to be a drawn-out affair, where members of the public can provide input with regard to proposed changes. Further, the DOL may elect at the end of the process to not change the current rule, promulgated in 2004, which sets the overtime threshold at $455 per week. However, during recent testimony before the House Subcommittee for Labor, Health and Human Services, Education, and Related Agencies of the Appropriations Committee, Secretary Acosta did signal that the administration believes the salary level should be increased from the current level. However, it is unlikely that it will reach the level set by the Obama administration’s rule. In the interim, employers should continue to adhere to the 2004 rule setting the exemption threshold at $455 per week.