All developed countries have some form of workers rights, but protections differ dramatically by country. Overtime is an especially important and controversial topic because people are so emotionally and financially invested.
Nearing the end of his time in office, President Obama set out to improve workers’ rights in the U.S. In May of 2016 Obama proposed an increase to the minimum salary for employees to qualify for exemption status. The proposal set out to increase the current minimum salary to qualify as exempt from $26,661 to $47,476. This is a significant increase and would result in many businesses classifying workers who were previously exempt, to nonexempt. Since only non-exempt employees are paid overtime, businesses would now have to pay many of their hourly wage workers overtime.
As you can imagine, business owners were not thrilled by this proposal. Can you really blame them? No one wants to pay for something that they did not have to pay for previously. A pro-workers’ rights politician would say that it’s a cost that businesses should have been paying already, but to business owners this is just another increased cost.
This proposal was set to be implemented on December 1st 2016, but the backlash from businesses and states was forceful. This resulted in 21 states suing, and in November 2016 led to a federal judge filing an injunction. While the injunction has now been appealed, this halted discussions and pushed the decision on this issue to the new administration.
Not surprisingly, the Obama and Trump administration have very different views about overtime. Many fear that the pro-business stance that Trump and his administration represent will result in the minimum salary for exempt status remaining the same.
On June 27 2017, these fears were slightly alleviated when the Department of Wage and Labor filed a formal request for information (RFI). The purpose of the RFI is to discover information on employers who adjusted employee wages in anticipation of Obama’s rule. The information uncovered by the RFI is intended to be published in the Federal Register, giving everyone access.
Just three days later Trump’s administration announced the intention to undergo further lawmaking in order to resolve the overtime debate. The administration made a point of stating they will not seek to advocate for a specific minimum salary. Essentially this just allows more time to postpone this decision.
It will be interesting to see what actions Trump and his team will take over the next few months. Will they maintain the idea that Obama’s rule is under review, or will they kill it? Will they put a minimum salary in place, or will they stay away from pinpointing an amount? Only time will tell, but workers’ rights advocates certainly have reason to worry.
Article provided by Evan Werner