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Last week, on Tuesday, September 20, some 21 states and a coalition of more than 50 business groups including manufacturing, construction, auto, franchising, retail, lodging, and insurance filed lawsuits attempting to overturn the new Department of Labor rule affecting overtime pay. The lawsuits were filed separately in U.S. District Court for the Eastern District of Texas.  Maine Governor, Paul LePage joined the 21 states as an individual plaintiff.

This rule is set to take effect in December of this year and will more than double the current minimum salary required to be exempt from the overtime regulations of the Fair Labor Standards Act. The lawsuit’s arguments assert that the new rule violates the U.S. Constitution and exceeds congressional authority.

Texas attorney general, Ken Paxton accused President Obama of trying to rewrite the law, which may lead to “disastrous consequences for our economy” while Labor Secretary Thomas Perez defended the regulation and called the lawsuits “obstructionist partisan tactics” preventing the Obama administration from ensuring Americans are fairly paid for extra hours.

For more information on this important issue, read the Wall Street Journal article “Group of 21 States Sues U.S. Over New Overtime-Pay Rule” and the Portland Press Herald article “LePage Joins Multistate Republican Lawsuit Over New Federal Overtime Rule.”

Looking for More Guidance?

This is a hot button issue due to the wide impact and potential cost of the changes for many employers. Now is the time to plan your strategy to address this important wage and hour rule change. Contact KMA for more information and guidance.