DOL Overtime Proposal Fight Is on Horizon
A highly anticipated proposal the U.S. Department of Labor unveiled Wednesday to expand overtime eligibility for millions of workers by setting the highest-ever salary threshold for exemptions will cause employers to rethink compensation, even as court challenges seem inevitable, attorneys said.
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"It's pushing the bounds beyond what is probably lawful, and the challenges will be coming," Jason Reisman of management-side firm Blank Rome LLP said about the new rulemaking.
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In the wake of the proposal, which will go through a 60-day public comment period, employers will have to grapple with whether to give workers raises to keep them exempt from overtime, or reclassify them as nonexempt and pay them overtime, attorneys said.
But that is not necessarily an easy decision for an employer, Blank Rome's Reisman said.
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Management-side attorneys are also concerned about automatic increases that under the proposed rule would happen every three years.
"It's going to be a nightmare for employers who have to keep increasing salaries to stay with it," Reisman said. "The original modern-day change was in 2004, the next one was in 2019, so to say it's going to happen every three years is pretty rapid-fire for employers."
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"DOL Overtime Proposal Fight Is on Horizon," by Max Kutner was published in Law360 Employment Authority on August 30, 2023.