Fate of New Federal Overtime Rules Uncertain, But New State-level Rules Now In Effect

By:
Chris Gaetano
Published Date:
Jan 3, 2017
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With a new administration in power, it's uncertain whether recent changes that expanded who's eligible for overtime will survive, but even if the matter is repealed on the federal level, similar state-level reforms have now gone into effect, according to Crane's New York Business News. The federal rules increase the threshold before workers are exempt from overtime from $23,660 a year to $47,476 a year, and increases the threshold for a "highly-compensated employee" (who are also exempt) from $100,000 a year to $134,004. While the rule was supposed to have gone into effect in December, a court decision led to a temporary injunction, saying that the changes exceeded the government's authority. While the Department of Labor said in the aftermath that it was exploring further legal options, this may not be the case once the new administration takes office, given numerous campaign promises to roll back government regulations on business.

Regardless, though, similar rules have already come into effect on the state level. Crane's reported that the overtime exemption threshold for New Yorkers has been increased from about $35,000 a year to about $40,000 for businesses with 10 or fewer workers and $42,000 for those with more than 10. While not as dramatic a jump as the federal changes, it none the less means that many workers who previously did not qualify for time-and-a-half now will, unless their pay is increased to bring them over the threshold. However, it's not certain that even this change will stay: Crane's reported that the decision halting the federal rule provides precedent for a similar decision in state courts. 

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