Even though the proposed overtime rule is likely to be challenged in court after it is finalized, employers should start examining how it will affect their workplaces, legal experts say.
"I don't think businesses should act now and make concrete changes," said Jeff Ruzal, an attorney with Epstein Becker Green in New York City. "A preliminary injunction is likely" after the rule is finalized, he said, but employers "should study and audit the workplace" and prepare for the rule to possibly take effect. They should analyze who is exempt and nonexempt and plan for complying "without jeopardizing the business or payroll."
Déjà Vu
Business leaders may think, "Here we go again" in reaction to the proposed rule, Ruzal said. The new proposed rule recommends a large increase in the overtime salary-level threshold, just as changes proposed in 2016 did. That rule was blocked on Nov. 22 of that year.
"The proposed rule contains a very substantial increase in the minimum salary threshold for white-collar exemptions, moving the weekly amount from $684 to $1,059, or the annual amount from $35,568 to $55,068," said Brett Coburn, an attorney with Alston & Bird in Atlanta. "While this jump is not quite as large as the increase that the Obama administration attempted in 2016—moving from $455 to $913 per week, or from $23,660 to $47,476 annually—it is still very significant."
The amount of $1,059 per week represents the 35th percentile of weekly earnings of full-time salaried workers in...
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