If implemented, the new rule will more than double the minimum salary overtime threshold — from $455/wk to $913/wk — for public and private workers without Congressional authorization. The complaint urges the court to prevent the implementation of the new rule before it takes effect, which is scheduled for December 1, 2016.
The rule will force many state and local governments to substantially increase their employment costs. Some governments may be forced to eliminate some services and even lay off employees.
“Once again, the Obama Administration has illegally expanded its own authority without thinking about the costs or consequences to the American people,” said AG Strange. “State budgets are already tight, and this one-size-fits-all rule could result in layoffs, understaffed government offices, and long lines for basic services. Ultimately, it will be the people who suffer the most from this latest example of federal overreach.“
On March 13, 2014, President Barack Obama ordered the Department of Labor to revise the Fair Labor Standards Act’s overtime exemption for executive, administrative and professional employees — the so-called “white collar” exemption — to account for the federal minimum wage. On May 23, 2016, the Department of Labor issued the final new overtime rule. It doubles the salary-level threshold for employees to be exempt from overtime, regardless of whether they perform executive, administrative, or professional duties. After December 1, 2016, all employees are entitled to overtime if they earn less than $913 a week—including state and local government employees.
The new rule also contains a ratcheting mechanism to automatically increase the salary-level every three years without going through the standard rule-making process required by federal law.
In addition to Alabama, other states who have joined the filing include: Arizona, Arkansas, Georgia, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Michigan, Mississippi, Nebraska, Nevada, New Mexico, Ohio, Oklahoma, South Carolina, Texas, Utah and Wisconsin.