Labor Secretary Backs Increase in Overtime Salary Threshold

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By Chris Opfer

Labor Secretary Alexander Acosta wants to make more workers automatically eligible for overtime pay, just not as many as former President Barack Obama’s administration did.

The salary threshold under which workers are entitled to time-and-a-half pay for all hours worked beyond 40 per week should be increased from its current level of about $24,000 per year, Acosta told Bloomberg TV July 7.

“The salary level does need to change, in my opinion,” Acosta said.

The Labor Department is no longer backing a stalled Obama era rule that would have hiked the threshold to about $47,000 per year. Government lawyers recently told an appeals court that the department will not continue to defend the rule, which was expected to make some 4 million workers newly eligible for overtime pay before it was put on hold by a federal district judge last year.

The Obama rule was touted as a way to bolster stagnant wages. Critics said it was too much too fast and would force businesses to shed jobs.

The DOL also asked the appeals court to affirm the department’s authority to use salary levels generally to help set overtime eligibility standards. Acosta said during his confirmation hearing that he might be comfortable with a salary threshold in the low $30,000 range to account for inflation in recent years.

The Labor Department on June 27 sent a request for information on the overtime rule to the Office of Management and Budget. The details of the request, which have not yet been made public, may shed some light on the specific aspects of the rule the DOL wants to tweak.

To contact the reporter on this story: Chris Opfer in New York at copfer@bna.com

To contact the editors responsible for this story: Peggy Aulino at maulino@bna.com; Terence Hyland at thyland@bna.com

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