U.S. Chamber, 21 States Sue DOL Over New Overtime Rules

In two separate lawsuits filed in the Eastern District of Texas, the Department of Labor is being sued over its new overtime exemption rules, which are scheduled to go into affect on December 1. The plaintiffs in one lawsuit are 21 states, led by Texas and Nevada. In the other, which was filed the same day, plaintiffs are a coalition of more than 50 business groups, including the U.S. Chamber of Commerce and the National Federation of Independent Business. The new rules make employees with salaries as high as $47,500 eligible for overtime, effectively requiring employers to pay overtime to a large number of additional workers. The current upper limit is $23,660. According to plaintiffs in both lawsuits, the new rules will result in major disruption to business, with widespread reclassification of employees as hourly rather than salaried workers, and significant numbers of layoffs and demotions.