Groups sue over overtime rules
NAHB, ABC say law is unnecessary, too costly
Two construction groups have joined a federal lawsuit to overturn the Obama administration’s new overtime rules.
The National Association of Home Builders and the Associated Builders and Contractors are among a number of national and local business groups that are challenging the Labor Department’s May decision to raise the annual salary threshold for overtime-exempt employees from $23,660 to $47,476.
The lawsuit was filed Tuesday in the U.S. District Court for the Eastern District of Texas.
“The Department of Labor overstepped its statutory authority by dramatically increasing the minimum salary for exempt employees and by automatically updating the salary threshold,” said ABC Vice President of Legislative and Political Affairs Kristen Swearingen. “The unprecedented automatic indexing provision circumvents the intent of Congress under the Fair Labor Standards Act and is particularly problematic for construction business owners who often need to project costs and workforce needs over multiple years for projects managed by exempt employees. These projects often last longer than three years and are meticulously planned in order to stay on time and budget. This rule will create uncertainty for contractors and their employees by forcing contractors to speculate about employees’ status years into the future when work on a project will actually be performed.”
The White House estimates that the new rules will affect 4.2 million employees.
The new law takes effect Dec. 1.