We were just about to put up a post on this subject today, and along came a press release from the Louisiana Association of Business and Industry which does a better job with it than we could have.
What has happened, as background, is that the Department of Labor put forth a rule which would require businesses to pay overtime to managers and others who earn salaries for jobs which routinely have hours beyond the standard 40 per week; you can only imagine the havoc and negative incentives this would cause.
Some 21 states have sued the Labor Department to prevent this rule from going forward. As of yesterday Louisiana is one of them.
Here’s LABI’s press release, which gives a very good detailing of the case…
Baton Rouge, LA- Today, the Louisiana Association of Business and Industry (LABI) issued the following statement in support of the recent federal court complaint filed by Louisiana Attorney General Jeff Landry against the U.S. Department of Labor regarding the newly issued overtime rule.
“LABI supports the coalition of 21 States, which has filed a federal court complaint challenging the U.S. Department of Labor’s new overtime rule. This latest executive branch ruling would undoubtedly add to the current burden facing Louisiana businesses, by adding more bureaucracy to the marketplace. By urging the court to prevent implementation of the rule, businesses will not have to immediately cope with the aftermath of more than doubling the minimum salary overtime threshold for public and private workers. The southern region of Louisiana recently experienced a historic flooding event which damaged 12,000 businesses, leaving them struggling to recuperate. This rule would effectively force a choice for flood-affected employers – delay the much-needed recovery efforts or more rapidly deplete the limited funds which they have available for recovery, paying for the higher labor costs dictated by this new rule.”
Earlier this year, the U.S. Department of Labor finalized a rule to require salaried workers earning less than $47,476 to be eligible for overtime pay. The overarching rule applies to executive, administrative and professional workers in the private sector, non-profit organizations, academia and state and local government. Small businesses, in particular, will be impacted. The new regulation is scheduled to go into effect nationwide on December 1, 2016.
LABI has been working diligently to advocate against the rule and work to prepare the business community for what implementing this rule might mean. On September 6, 2016, LABI issued a formal request (http://bit.ly/2cRsgRU), to the U.S. Department of Labor Secretary Thomas E. Perez, to delay the implementation of the new federal overtime rule in the 22 Louisiana parishes that were declared disaster areas as a result of the recent historic flooding. The request outlined the devastation facing the southern region of the state and specifically, what impact this rapidly approaching change would have on recovery efforts.
The week of September 12, 2016, LABI traveled to D.C. to meet with the Congressional Delegation, where they asked that Congress push back on the overtime rule. The LABI delegation made the case that the South Louisiana business community, as they recover from a devastating flood event, needs additional time to adjust and prepare for such an impactful change.
On September 20, 2016, LABI hosted, in their Baton Rouge offices, an “Overtime Overhaul” seminar. The seminar was organized to provide additional information that might more clearly explain how this change will impact small businesses across the flood-ravaged region. While the seminar provided useful information, an overwhelming majority of participants remain apprehensive concerning the impending new overtime policy.
And here is the press release from Landry’s office…
BATON ROUGE, LA – Attorney General Jeff Landry has joined a coalition of 21 states in filing a federal court complaint challenging the United States Department of Labor’s new overtime rule.
If implemented, the new rule will more than double the minimum salary overtime threshold (from $455/wk to $913/wk) for public and private workers. The complaint urges the court to prevent the implementation of the new rule before it takes effect, which is scheduled for December 1, 2016.
“Once again, the President has circumvented Congress and attempted to legislate through executive mandate. Like Obamacare before it, this latest overreach will force employers to hire less people and cut hours of their existing workers,” said General Landry. “This red-taped bureaucratic edict will especially hurt the Louisiana workforce in the education, retail, government, health, hospitality, and professional service industries. For their sake and the sake of federalism, I have joined Attorneys General from across the country to stop this job-killer.”
In addition to Louisiana, the other states who joined this filing are Nevada, Alabama, Arizona, Arkansas, Georgia, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Michigan, Mississippi, Nebraska, New Mexico, Ohio, Oklahoma, South Carolina, Texas, Utah, and Wisconsin.
President Barack Obama ordered the Department of Labor in 2014 to revise the Fair Labor Standards Act’s overtime exemption for executive, administrative, and professional employees – the so-called “white collar” exemption – to account for the federal minimum wage. On May 23, 2016, the Department of Labor issued the final new overtime rule. It doubles the salary-level threshold for employees to be exempt from overtime – regardless of whether if they perform executive, administrative, or professional duties. After December 1, 2016, all employees are entitled to overtime if they earn less than $913 a week – including state and local government employees. Additionally, the new rule contains a ratcheting mechanism to automatically increase the salary-level every three years without going through the standard rule-making process required by federal law.