On June 27, 2017, the U.S. Department of Labor sent a Request for Information related to the now-enjoined overtime rule to the Office of Management and Budget for review. After OMB completes its review, the RFI will be published in the Federal Register for public comment.
The new overtime rule, which was to take effect on December 1, 2016, was enjoined on a national basis by a Texas district court last November. Under the new rule, employers would have had to pay most “white collar” employees a minimum salary of $913 per week ($47,476 annually) to maintain their exemption from the overtime rule. With the injunction of the new rule, the minimum salary for exemption for most executive, administrative, and professional employees remains $455 per week ($23,660 annually) under federal law.
Prior to the change in administration in Washington, the DOL took an appeal of the injunction, which remains pending before the Fifth Circuit. The DOL’s reply brief on appeal is due on June 30, and many expect the DOL—now an agency of the Trump administration—to withdraw the appeal later this week.
In testimony yesterday before the Senate Appropriations Subcommittee on Labor, Health and Human Services, Education, and Related Agencies, Labor Secretary Alexander Acosta noted that the RFI would ask the public to comment on a number of questions that would inform DOL’s thinking on a new overtime rule, including that the proposed salary increases in the enjoined rule were too severe. Senator Lamar Alexander (R-Tenn.), a member of the subcommittee, noted that the “rapid rate of increase” was “just too high for many parts of the country” and especially burdensome for non-profits and universities. He urged Secretary Acosta to consider different salary levels for different parts of the country and to extend the advance notice period for any future increases in the salary thresholds.
The RFI confirms that DOL is likely to propose some version of a new overtime rule, consistent with comments that Secretary Acosta made during his confirmation hearings. What exactly that new rule will look like remains to be seen, but many expect an increase in the salary threshold for exemption to the low $30,000 range.
In his testimony, Secretary Acosta also expressed his “personal goal” to have the vast majority of DOL sub-department leadership identified and in the process of being cleared in short order. As of today, the offices of Administrator and Deputy Administrator of the DOL Wage and Hour Division, among others, remain vacant.