Overtime Rule Advances Toward Publication

DOL sends proposed changes to OMB for review

Beth Mirza By Beth Mirza March 15, 2016

The final overtime rule is edging closer to release: yesterday, the Department of Labor (DOL) sent to the Office of Management and Budget (OMB) its final changes for determining which workers are eligible for overtime pay. The revision to Fair Labor Standards Act regulations is expected to affect millions of employees currently considered exempt from overtime, requiring them to be reclassifed as nonexempt.

After a review period—which could take as long as several months or as short as a few weeks—the final rule will be published in the Federal Register and take effect within 60 days of publication.

The proposed rule was published on July 6, 2015, and received more than 250,000 comments (the Society for Human Resource Management submitted a comment letter last September). Differences between the proposed and final rule won't be made public until the final rule is issued.

At the SHRM Employment Law & Legislative Conference yesterday, Tammy McCutchen, an attorney with Littler in Washington, D.C., and a former administrator of the DOL’s Wage and Hour Division, advised attendees to keep an eye on reginfo.gov, which tracks government agencies’ regulatory actions as they are submitted for review to OMB. Sure enough, the rule appeared on the site late March 14.

At the conference, McCutchen told attendees she believed the rule would work its way quickly through OMB and most likely be published by July 7, and take effect on Labor Day, Sept. 5. Alternatively, she said, the rule would be published the Friday before Labor Day, Sept. 2, to take effect Nov. 1—just prior to Election Day.

The Obama administration must work quickly to implement the rule to protect it from being overridden, if a Republican wins the White House. Under the Congressional Review Act, a joint resolution from both houses of Congress and the President can undo laws and rules passed during the final 60 legislative days of the previous Congress. The act has been invoked only once before—to revoke the ergonomics rule.

McCutchen urged attendees to prepare now for the rule’s implementation. More employees will be considered eligible for overtime as the salary level rises. The proposed rule recommended setting the salary threshold for exempt employees at $50,440, up from the current $23,660 annually.

Beth Mirza is director of online news operations for SHRM.

Related SHRM Articles:

Proposed Overtime Rule Threatens Nonprofits’ Survival,SHRM Online Legal Issues, February 2016

DOL’s Final Overtime Rule Expected in Latter Half of 2016, SHRM Online Compensation, November 2015

Late Release of Overtime Rule Could Mean Short Implementation Period, SHRM Online Legal Issues, November 2015

SHRM's Comment Letter to the Department of Labor, SHRM Government Affairs, September 2015

Proposed Overtime Rule Puts Focus on Compliance, SHRM Online, June 2015

Related Resource:

Latest News: Fair Labor Standards Act Overtime Regulations, SHRM Policy Action Center


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