A federal court has put the brakes on the Obama administration’s plan to boost overtime pay for millions of U.S. workers.
On Tuesday, a judge for the Eastern District of Texas issued an injunction blocking the Labor Department from increasing the overtime eligibility threshold to $47,476, from its current $23,660 annual salary level. The law was to go into effect Dec. 1.
Construction organizations the National Association of Home Builders and the Associated Builders and Contractors were among the many business organizations that had filed suit to block the rule, which was the first increase in the overtime pay law since 2004.
“Construction contractors are pleased that the court has stepped in to provide relief from another overreaching and burdensome regulation from the Department of Labor,” said Kristen Swearingen, ABC's vice president of legislative and political affairs . “By dramatically increasing the minimum salary threshold for exempt employees, the Department of Labor’s overtime rule would have taken workplace flexibility away from employees and may have required some employers to consider switching certain employees from salaried to hourly positions.
“Additionally, the rule would have a significant impact on commercial and industrial construction projects in particular, since they often last longer than three years and are carefully planned to stay on time and under budget,” Swearingen added.
The Labor Department said it disagreed with the judge's ruling and may appeal.