Federal Judge Overrides Obama Overtime Pay Expansion

Mark Gruenberg Editor, Press Associates Union News

Millions of workers who would have been eligible for a raise in pay starting on December 1 lost it when a combination of business groups and 21 GOP-run state governments convinced a federal judge in rural Texas to toss the Obama administration’s expansion of overtime pay eligibility.

The Nov. 22 decision by U.S. District Judge Amos Mazzant is nationwide, and brings to a screeching halt the administration’s plan to more than double the pay cap for overtime eligibility, to $47,892 yearly. The cap now is $23,660, under restrictive GOP Bush administration rules that also prevent many workers who earn less from getting overtime pay.

The Labor Department calculated that 4 million workers would become eligible for overtime pay under the new rule. The Economic Policy Institute, using Bureau of Labor Statistics data, said it would help 12.5 million workers, with 50.9 percent of them women.

The AFL-CIO had no immediate comment on the judge’s ruling. It campaigned hard for the overtime pay rule expansion. More than a decade ago, AFL-CIO President Richard Trumka hosted an outdoor press conference denouncing the restrictive Bush overtime pay rule.

Debra Ness, executive director of the National Partnership for Women and Families, blasted the ruling, particularly its impact on woman workers. She called Mazzant’s decision “an appalling overreach that must not stand.

“Forced overtime without pay – an unacceptable form of worker exploitation – must end. It’s past time to restore basic fairness to our workplaces. Millions of women will suffer if this injunction stands. Workers will lose, families will lose, our economy will lose and our country will lose if the overtime rule is permanently blocked,” Ness added.

Mazzant’s decision marks the latest Obama administration rule tossed by a judge in deep red Texas in the last 21 months. Others include disclosure of labor violations by federal contractors and a rule mandating disclosure of spending by businesses on union-busters. Business groups and right wing state governments routinely use federal courts in rural Texas to thwart pro-worker and pro-minority administration rules. 

EPI also calculated that one of every six workers who would have benefited from the overtime pay rule are Hispanic-named, along with one of every eight African-American workers and one of every four workers with a high school diploma, but no further education.

“Workers making at or above the old threshold could have been excluded from overtime protection if their jobs were determined to be executive, administrative, or professional (EAP) jobs. The new rule raises the threshold from $455 per week to $913 per week in 2015 dollars,” EPI explained.

“There are 12.5 million salaried workers making at least $455 but less than $913 per week, and under the Fair Labor Standards Act, those workers could have been excluded from automatic overtime protection if they were classified, or incorrectly classified, as EAP employees,” EPI said. Mazzant tossed out the whole rule, including curbs on misclassification.

The judge was particularly critical of how the Labor Department tried to curb the exemption for the executive, administrative and professional workers. “Congress defined the EAP exemption with regard to duties, which does not include a minimum salary level,” he said.

“Directly in conflict with Congress’s intent, the final rule states that ‘white-collar employees subject to the salary level test earning less than $913 per week will not qualify for the EAP exemption, and therefore will be eligible for overtime, irrespective of their job duties and responsibilities,’” Mazzant added.

The Labor Department said an injunction against the overtime pay rule “would harm the public. Defendants point out that enjoining the final rule would deny additional pay, either from an increased salary or from overtime payments, to those who are misclassified. The court finds the public interest is best served by an injunction,” the judge’s 20-page decision said.

 “If the department lacks the authority to promulgate the final rule, then” it “will be rendered invalid and the public will not be harmed by its enforcement. However, if the final rule is valid, then an injunction will only delay” it. “A preliminary injunction preserves the status quo while the court determines the department’s authority to make the final rule” and its validity.

Except for Delaware, EPI calculated that the largest percentages of workers, by state, who would have benefited from the new rule live in red states. Most of their state governments sued to overturn it.

The highest percentage of benefiting workers is in West Virginia (30.7 percent of all workers), whose legislature is heavily Republican. It’s followed by Arkansas (30.6 percent), South Carolina (30.3 percent), Florida (29.3 percent), Tennessee (29.2 percent), Idaho (29.1 percent), Georgia (28.2 percent), South Dakota (28.2 percent), Delaware (27.7 percent), and North Dakota (27.5 percent).



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