Plano Chamber Joins Lawsuit Against Department of Labor Overtime Ruling

The Plano Chamber of Commerce joined the U.S. Chamber of Commerce, the Texas Association of Business, more than 40 other chambers of commerce throughout the state of Texas, plus other business organizations and sector-specific business groups in filing a lawsuit against the new Department of Labor overtime rule, which goes into effect December 1. The text below is from Kelley Crimmins’ article in Community Impact Newspaper.

gavel

The U.S. Chamber of Commerce and the parties involved submitted detailed comments describing the problems they believe this regulation would cause for local businesses, said Jamee Jolly, president and CEO of the Plano Chamber of Commerce. The Plano Chamber was the lead plaintiff based on its location within its district, along with 10 other local chambers.

“At the local level, we surveyed our membership and collected feedback regarding the potential impact to local businesses,” she said. “It was clear that our local business community would be adversely impacted by the new regulations.”

The overtime pay rule changes the salary threshold for those who are exempt from receiving mandatory overtime pay. Currently, full-time, salaried workers making $23,660 or more per year do not qualify for overtime pay. Under the rule, that salary level changes to $47,476 or more per year in 2016.

The doubling of the minimum salary threshold will have significant adverse effects on businesses, nonprofit organizations and associations, Jolly said.

“The new overtime rule will limit workplace flexibility, impede career and promotion opportunities, and will make it harder for businesses and nonprofits to expand to meet the needs of their customers and constituents, in addition to imposing significant new economic costs,” she said.

The Department of Labor said about 4.6 million employees who are currently exempt from overtime pay would receive overtime protection under the rule, which the department argues would help those workers receive fair compensation for their work.

U.S. Secretary of Labor Thomas Perez said in a statement Tuesday he expects the overtime rule to withstand legal scrutiny, dismissing the lawsuit as a partisan attempt to undermine the Obama administration’s labor policies.

“Despite the sound legal and policy footing on which the rule is constructed, the same interests that have stood in the way of middle-class Americans getting paid when they work extra are continuing their obstructionist tactics,” Perez said in the statement.

The overtime rule was intended to “restore the intent” of the Fair Labor Standards Act, Perez said. The effects of the law’s overtime protections have eroded over time, he said.

But Randy Johnson, U.S. Chamber vice president of labor, immigration and employee benefits, said in a statement that the policy would result in significant new labor costs and cause “disruptions” in the labor market.

“The new overtime rule will result in salaried professional employees being converted to hourly wages, and it will reduce workplace flexibility, remote electronic access to work, and opportunities for career advancement,” Johnson said.

The suit states that, by setting an excessively high salary threshold for determining who qualifies as “executive, administrative and professional employees,” the rule departs from the intent established by Congress in the Fair Labor Standards Act. The lawsuit was filed in the U.S. District Court for the Eastern District of Texas.

Read the full article by Community Impact Newspaper HERE.

Read the Plano Chamber et. al. v. U.S. Department of Labor lawsuit HERE.