By Yuqi Wang, Policy Analyst, Economic Policy Project, NCLR
On November 23, the U.S. District Court for the Eastern District of Texas blocked the Department of Labor’s (DOL) updated overtime eligibility rule from going into effect by suspending the rule’s December 1 enforcement date. The Department of Labor’s (DOL) updated overtime rule, finalized in May 2016, would have brought employers and workers into the 21st century by increasing the overtime salary threshold from $23,660 to $47,476. By siding with business interest groups, the Court’s decision is a blow to the 12.5 million workers who were counting on the updated overtime rule to provide them with the right to be compensated fairly for a hard day’s work. Workers in office and administrative positions, transportation and material moving professions, as well as construction occupations are just some of the people severely impacted by this decision.
It’s important to note that, contrary to the Court’s assertion that the DOL exceeded its authority, the agency has had the ability to change the minimum salary threshold for overtime for the past 78 years. In fact, the DOL has updated the salary threshold seven times since the Fair Labor Standards Act (FLSA) became law in 1938.
The national unemployment rate fell from 4.9% in October to 4.6% in November, the lowest it has been since 2007. says the Department of Labor in it’s monthly jobs report. Last month, 178,000 jobs were added, which is likely due to modest job growth and more than 400,000 people leaving the work force.
The U.S. Department of Labor reported today that U.S. employers added 156,000 jobs in September 2016, down from 167,000 in the prior month. The national unemployment rate remained essentially unchanged at 5 percent. The Latino unemployment rate increased from 5.6 percent in August to 6.4 percent in September.
The Supreme Court has ended the legal battle against the recently won rights of home care workers to critical overtime and minimum wage benefits.
On Monday, the high court decided not to hear an appeal from several home care industry groups that argued the Department of Labor (DOL)’s expansion of minimum wage and overtime benefits to home care workers was an illegal and unjustified change to the Fair Labor Standards Act (FLSA). The court’s decision not to hear the case is a victory for home care workers, and an end to the court case Home Care Association of America v. Weil, which sought to take away minimum wage and overtime rights from home care workers.
From 1975 until yesterday afternoon, American workers making more than $23,660 per year were ineligible for federal overtime protection. Thanks to an update to that rule from the U.S. Department of Labor, the threshold on overtime pay has now been raised to include all employees earning less than $47,476 per year.
Approximately 12.5 million Americans will now be able to benefit from overtime pay. Of those, more than two million Latinos, or one in three of all salaried Latino employees, will be eligible for overtime, according to the Economic Policy Institute.
The news of the updated overtime rule is a welcome respite for American workers who, for too long, were working well over 40 hours per week without receiving appropriate compensation. The rule will also go a long way to closing the extreme pay gap felt by women and minorities.
“We are very pleased that the administration has acted on behalf of America’s workers who are the backbone of our economy. The rule will help ensure middle-class workers are able to see a greater benefit from their hard work. This rule will not only help individual families better meet their own needs, but will create additional economic stimulus and spending that will improve our nation’s overall economic outlook,” said NCLR Vice President Eric Rodriguez.
More information about the updated overtime rule and overtime coverage can be found on the the Department of Labor’s website.