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Revised update to federal overtime rule being considered

Revised update to federal overtime rule being considered

Secretary of Labor Alexander Acosta said he would be amenable to changing the federal overtime rule, but not to the extent proposed by the Obama administration.

During a congressional hearing Wednesday, Mr. Acosta said the Labor Department is now drafting a request for information seeking comments on the issue, which will be ready in two to three weeks.

He made his comments during testimony before the Subcommittee for Labor Health and Human Services, Education, and Related Agencies of the U.S. House of Representatives’ Appropriations Committee.

The controversial overtime rule proposed by the Department of Labor during the Obama administration would have raised the threshold for overtime-exempt employees to $913 a week, or $47,476 annually for a full-time employee, from the current $455 a week, or $23,660 annually.

Mr. Acosta said during his testimony that while he agreed the overtime rule needs to be updated, the threshold proposed for overtime-exempt employees proposed by the Obama administration would be a “shock to the system.”

Alfred B. Robinson Jr., a shareholder with Ogletree, Deakins, Nash, Smoak & Stewart P.C. in Washington, said Mr. Acosta’s comments are “very significant and very appropriate.”

The increase proposed by the Obama administration “created a hardship for employers, and a more reasonable salary level would be, and is, appropriate. I’m glad the Labor Department is moving on that.”

“I think almost everyone agrees it needs to be increased,” which has not occurred since 2004, Mr. Robinson said. “It’s just that the last administration overreached.”

Mr. Robinson also said he hopes the Labor Department will remove a provision in the Obama administration-proposed rule that would automatically increase the salary threshold every three years.

The rule has been the subject of a significant amount of litigation. On Nov. 22, Judge Amos L Mazzant III of the U.S. District Court in Sherman, Texas, issued a preliminary injunction halting the overtime rule’s planned Dec. 1 implantation in response to litigation filed by states and business organizations.

The Labor Department then appealed the ruling to the 5th U.S. Circuit Court of Appeals in New Orleans, which, in the latest development in the case, had given the Trump administration until June 30 to file its brief in the case.

The Trump administration had been widely expected to withdraw the Department of Labor’s support for the rule.



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