Proposed Federal Overtime Regulations Released; MI Chamber Prepares to Oppose

July 13, 2015

President Obama and the US Department of Labor have unveiled a proposal to unilaterally change the nation's overtime pay law. The proposed rules would dramatically expand the number of employees who can qualify for overtime pay by raising the threshold for guaranteed pay from a salary of $23,660 to $50,440 (or from $455 to $970 per week).

Employees are currently “exempt” if: 1) Their job duties meet the statutory requirements for executive, administrative, professional or other categories; and 2) They are paid at least $455 weekly. The proposed rule more than doubles the threshold, thereby making the job duties threshold irrelevant for millions of workers, or upwards of 40 percent of the workforce, and making them eligible for overtime pay. 

The proposed change is one of the most aggressive forms of federal governmental interference in the workplace we’ve seen in a decade or more. The Michigan Chamber plans to oppose the proposed rule change now that the window for public comment is open, reminding the Administration that it cannot impose a government mandate of this size and expect it not to have an impact on the economy or the very workers it's hoping to help.  

The threat of the regulation becoming effective is real. There is a 60-day mandatory comment period (comments are due on or before September 4, 2015), but the change can go in effect without a Congressional vote. Legal experts fully expect the rule to become effective in 2016.  

Please contact Wendy Block at (517) 371-7678 or with any questions.