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Federal Judge Rules Against Making Millions More Salaried Workers Eligible for Overtime Pay
Eligibility for overtime pay was expected to extend to about 4.2 million more workers on Dec. 1, but all of that has changed now that a federal judge has halted implementation of the rule change.
Under the new rule, salaried workers earning up to $47,476 a year would become eligible for overtime pay. The old rule, which remains in effect, sets the threshold for overtime-eligible salaries at $23,660.
The rule change was aimed at ensuring better paychecks and better work-life balance for lower-paid managers in a variety of industries, including hospitality and restaurants.
The judge’s last-minute ruling also throws a kink into the plans of many employers, who had been preparing for months for the change to take effect. Many employees had already been promised raises to bring their pay above the new threshold, and other employees had already been re-classified as hourly employees.
Whether businesses will readjust to the judge’s decision remains to be seen.
It also remains to be seen whether the plan to broaden eligibility for salaried workers will survive into the next presidential administration.
An employer is not allowed to simply re-classify an hourly worker as a manager in order to avoid paying overtime.
Specific qualifications must be met for an employee to be exempt from overtime pay as a manager. For more on those qualifications, please see The Zoldan Law Group’s overview of manager misclassification. If you believe your employer has erroneously misclassified you as a manager, you may be due financial compensation.
The employment law attorneys of The Zoldan Law Group advise and represent employees in Scottsdale, Tempe, Tucson and throughout Arizona.