The Allen-Fairview Chamber of Commerce on Tuesday joined chambers from McKinney, Plano, Frisco and more than 50 Texas business organizations in filing
a lawsuit challenging a new Department of Labor overtime rule.
The lawsuit, led by the U.S. Chamber of Commerce, National Association of Manufacturers and the Texas Association of Business, alleges a new overtime rule exceeds the Department of Labor's statutory authority under the Fair Labor Standards Act.
"The Allen-Fairview Chamber joined the lawsuit because we felt it would have adverse impacts on our chamber members and other businesses, and not-for-profit organizations in our community," Allen-Fairview Chamber President and CEO Sharon Mayer said Wednesday in an email. "These would include significant new labor costs and impose an automatic update provision every three years with no input."
U.S. Secretary of Labor Thomas Perez said in a statement Tuesday he expects the overtime rule to withstand legal scrutiny, dismissing the lawsuits as a partisan attempt to undermine the Obama administration's labor policies.
"Despite the sound legal and policy footing on which the rule is constructed, the same interests that have stood in the way of middle-class Americans getting paid when they work extra are continuing their obstructionist tactics," Perez said in the statement.
The overtime rule was intended to "restore the intent" of the Fair Labor Standards Act, Perez said. The effects of the law's overtime protections have eroded over time, he said.
Mayer disagrees with Perez's assessment of the lawsuit as partisan.
"Our sole intent is to ensure that there is a mutually beneficial employment arrangement between employees and employers," Mayer said.
Mayer pointed to other potential consequences if the rule goes into effect, such as the reduction of workplace flexibility and limitation of electronic access to work and opportunities for career advancement. Fairness in compensation, she said, should be defined regionally and by industry, not in this case by the federal government.
The overtime pay rule changes the salary threshold for those who are exempt from receiving mandatory overtime pay. Currently, full-time, salaried workers making $23,660 or more per year do not qualify for overtime pay. Under the rule, that salary level changes to $47,476 or more per year in 2016.
The rule would go into effect Dec. 1.
The Department of Labor said about 4.6 million employees who are currently exempt from overtime pay would receive overtime protection under the rule, which the department argues would help those workers receive fair compensation for their work.
The suit states that, by setting an excessively high salary threshold for determining who qualifies as “executive, administrative and professional employees,” the rule departs from the intent established by Congress in the Fair Labor Standards Act. The lawsuit was filed in the U.S. District Court for the Eastern District of Texas.
The state of Texas also announced its own federal lawsuit against the pending overtime rule change, joining a coalition of 21 states. Attorney General Ken Paxton said in a statement the new law would “lead to disastrous consequences for our economy.”