U.S. District Judge Amos Mazzant of the Eastern District of Texas has slapped an injunction on Obama’s Department of Labor overtime rule that would make 4 million workers eligible for mandatory extra pay and time-off.
At the request of 21 states, the U.S. Chamber of Commerce and other groups, Judge Mazzant has blocked the regulation just in time as it was to take effect on December 1.
“We are very pleased that the court agreed with our arguments,” said Randy Johnson, the Chamber’s senior vice president of labor, immigration and employee benefits. The rule “would have caused many disruptions in how work gets done” and “reduced workplace flexibility, remote electronic access to work, and opportunities for career advancement.”
According to the Labor Department, this would cost the country’s business $295 million per year.
“The Labor Department’s overtime changes are a reckless and aggressive overreach of executive power, and retailers are pleased with the judge’s decision,” said David French, the National Retail Federation’s senior vice president for government relations to The Washington Post.
So basically, Obama tried to slip in an executive action to reclassify workers as “hourly,” so they would be eligible for overtime.
“The judge said the Labor Department regulation exceeded the authority granted it by Congress, which he said gave Labor the right to define which workers are considered salaried but only based on the duties they performed, not by how much they made,” writes The Washington Post. “The Labor Department regulation, which business groups claimed would cost them $12 billion a year over the next decade, raised the salary threshold for receiving mandatory overtime from $23,660 to $47,476 a year, or from $455 to $913 a week.”
Mazzant takes issue with the fact that Labor Department is attempting to do this without Congress’ permission and “exceeds its delegated authority and ignores Congress’s intent by raising the minimum salary threshold such that it supplants the duties test.”
“If Congress intended the salary requirement to supplant the duties test, then Congress and not the Department, should make that change,” continued Mazzant.
Small business owners can only temporarily rejoice since the case is postponed, but this is a step in the right direction to protect businesses.
“I am pleased that a Federal District Judge has, yet again, pumped the brakes on another harmful regulation from the Obama administration. This federal overtime rule is devastating … but particularly in states with a low cost-of-living. The economic realities and regional cost-of-living differences that exist throughout the country were completely ignored by the Department of Labor on this proposal. I am hopeful that this rule can be brought back to the drawing board for a new rule-making process that works for the entire nation,” said Sen. James Lankford, Oklahoma Republican.
So what does the future hold for this overtime rule with Trump as president? Trump has consistently said he wants less regulation on small business and plans to limit them. So is this just the beginning of the end for this overtime rule? Looks like it.