Labor Department Defends Its Authority on Federal Overtime Rule

Recently, the U.S. Department of Labor defended its authority of using salary thresholds when setting mandatory overtime pay before the New Orleans-based 5th U.S Circuit Court of Appeals. Late last year, a Texas federal judge blocked the Obama Administration’s final overtime rule just days before it was to go into effect. The Obama Administration’s DOL rule would have raised the salary threshold for receiving mandatory overtime from $23,660 to $47,500 a year. The Trump Administration has continued its appeal where it is likely to issue a new salary threshold but nowhere close to the level set by President Obama. Earlier this year, Secretary of Labor Alexander Acosta noted that the overtime rule has not been updated since 2004, hinting that the DOL is likely to rescind the final Labor Department rule and issue a new rule that would gradually increase the salary threshold. Acosta has suggested an inflation adjusted threshold of $33,000.