Acosta Testifies About Overtime Rule and Other Workplace Issues

The secretary of labor spoke to a House committee about DOL priorities

Lisa Nagele-Piazza, J.D., SHRM-SCP By Lisa Nagele-Piazza, J.D., SHRM-SCP November 16, 2017
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The U.S. Department of Labor (DOL) is working hard to increase employment opportunities for Americans and ensure safe, healthy and fair workplaces, said Secretary of Labor Alexander Acosta at a House of Representatives committee hearing.

The DOL is on the front line of the issues facing the national economy, employment growth and retirement security, noted Education and the Workforce Committee Chair Rep. Virginia Foxx, R-N.C. Whether discussing health care worker protections, retirement planning, workforce development, or employee wages and benefits, it is the committee's responsibility to ensure related policies are in the best interest of workers, employers and taxpayers, she added.

Acosta discussed a number of those issues at the Nov. 15 hearing, including the status of a potential new overtime rule, apprenticeship programs and association health plans. Here are some of the key points he made.

Overtime Rule

There has been a lot of talk in the HR community about what will happen with the Fair Labor Standards Act's overtime-exempt salary threshold for white-collar workers. The Obama administration sought to raise the threshold to $47,476, but a federal judge in Texas said the rule is invalid. For now, the 2004 threshold of $23,660 remains—which Acosta has said is too low.

[SHRM members-only toolkit: Determining Overtime Eligibility in the United States]

Under President Donald Trump, the DOL put out a request for information earlier this year to determine if there is a need for new rulemaking. Rep. Jason Lewis, R-Minn., asked the labor secretary to provide an update on the department's efforts with respect to the information collected and how it will be used.

Acosta reiterated that the 2004 rule needs to be updated. "Life has become much more expensive," he said, but he added that raising the exempt salary threshold to over $47,000 would have "created a shock to the system."

The request for information allowed the DOL to gather important data from the public that will help the department write up a new overtime rule "that will be in accordance with our legal standards," he said. The DOL is in the process of reviewing around 200,000 comments it received.

Although a court deemed the Obama-era overtime rule invalid, the Trump administration appealed the court's ruling. Acosta said the DOL believes it was clear from the ruling that the department has the authority to set a reasonable salary threshold, but the ruling  "could be read as less than clear."

Apprenticeship Programs

This week is the DOL's third annual National Apprenticeship Week, which offers business leaders and other critical partners a chance to express their support for apprenticeships, according to the department's website.

"We should be growing apprenticeships in this nation," Acosta said at the hearing. Members of the administration's task force on apprenticeship programs range from "leaders from business, from labor, from educational associations, from trade associations to governors, community organization leaders, public individuals—all coming together to talk about how to extend apprenticeships across industries, especially into those industries where apprenticeships are underrepresented."

Association Health Plans

Acosta said the DOL has submitted a notice of proposed rulemaking on association health plans. Trump signed an executive order on Oct. 12 directing the DOL and other federal agencies to review regulations issued under the Affordable Care Act and to explore ways to expand rules for association health plans, which would allow small employers to collectively purchase health care plans.

Acosta said the order will make a difference for workers at small companies. "Association health plans, generally, will provide and do provide an opportunity for often small businesses to come together and create scale. That will give small businesses more negotiating power with health insurers," he said.

 

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