Employers Claw Back Raises

Just weeks ago, an executive order signed by President Obama that would have required time-and-a-half pay for those working more than 40 hours a week was set to go into effect. Then the measure was temporarily blocked by a federal judge in November, and is expected to be undone entirely by incoming President Donald Trump. The order would have doubled the salary threshold for mandatory overtime pay from $23,660 to $47,476. Some employers, like Walmart, hiked up salaries for some employees to avoid the federal overtime threshold. Though Walmart says it will keep the raises it promised to entry-level managers, other firms and organizations are rescinding planned pay increases. Politico reported that Massachusetts General Hospital, Iowa State University, the University of Iowa, Michigan State University, Rutgers University, and others have gone back on plans to pay employees more, assuming the Trump administration will abolish the rule. The president-elect’s nomination of fast-food executive Andy Puzder as labor secretary would suggest that is the plan; Puzder called the overtime order a measure that “will simply add to the extensive regulatory maze the Obama Administration has imposed on employers, forcing many to offset increased labor expense by cutting costs elsewhere.”