Press Releases

News from EPI Injunction against overtime rule takes a crucial labor protection away from 12.5 million people

A Texas judge’s decision to block the Obama administration’s new overtime rule, which would have gone into effect today, strips 12.5 million workers of a crucial labor protection. According to EPI estimates, the rule would have extended overtime pay eligibility to 4.9 million workers and made it easier for another 7.6 million workers to prove their eligibility.

“Workers were supposed to get a raise today and they’re not. The overtime rule is an example of the kind of meaningful protections government can put in place to lift wages,” said EPI Vice President Ross Eisenbrey. “It is exactly the kind of policy we need to strengthen working- and middle-class families. President Obama and Labor Secretary Perez should be applauded for their efforts. I hope that President-elect Trump will stand with working Americans and defend the overtime rule.”

Many businesses had already given their employees raises and put new policies in place in response to the rule. Those raises and policy changes are now in jeopardy, and workers are left wondering what comes next.

“I would have fallen under the new salary threshold and received overtime. I was supposed to start reporting my hours this week, but my HR department has told me to hold off on that change,” said Gordon C., a web communications specialist at an Arizona university. “My workplace is one of many that already implemented transitions to the new overtime procedures, and everyone has been caught off guard.”

The injunction is a disappointment to millions of working people who are forced to work long hours with no extra compensation, and is a blow to the effort to raise wages and lessen inequality.

“This is an extreme and unsupportable decision and is a clear overreach by the Court,” said Eisenbrey. “For 78 years the Department of Labor has used salary as well as duties to determine who is eligible for overtime and who can be exempt. Congress has amended the Fair Labor Standards Act many times and has never objected to the salary test, and presidents from FDR to George W. Bush have consented to a salary test.”