Employers in the Spring and Klein area are adjusting their compensation plans to adhere to overtime regulations from the U.S. Department of Labor that were originally scheduled to go into effect Dec. 1.

The new rule was announced in May and would extend overtime protections to more than 4 million salaried workers who did not already qualify for overtime pay, according to the labor department. Under the rule, salaried workers who earn $913 or less per week—or $47,476 annually—would be entitled to overtime compensation.

However, a federal judge from Texas sided with concerns of some of the business community and elected officials by filing an injunction blocking the rule’s implementation Nov. 22.

Judge Amos Mazzant of the U.S. District Court Eastern District of Texas was responding to two lawsuits that were filed against the labor department. The first was filed by more than 50 business organizations, including the Houston Northwest Chamber of Commerce.

“Some will lose their jobs,” said  Barbara Thomason, Houston Northwest Chamber of Commerce president. “You just don’t know what an employer will do to adjust to maintain the viability of their business.”

According to the injunction, the court ruled the Department of Labor does not have the statutory authority to apply
the rule.

The law provides three options for employers who are affected by the new rule. Employers can increase the salary of employees to the new threshold, compensate employees for overtime worked at 1.5 times the employee’s regular rate of pay, or can reduce or eliminate any overtime work, said Robin Mallett, Department of Labor Wage and Hour Division director of the Houston district office.

“We believe that the rule is going to put more money into the pockets of middle-class workers, or it is going to give them more free time,” she said. “The number of workers who are working more than 40 hours per week continues to increase.”

The effect to businesses could be an increase to costs, Thomason said, with higher salaries and overtime paid.

“They may have to do with less staff—they will have a range of options, but all of them are not good for business,” she said.

The Department of Labor issued a statement regarding the overtime litigation, expressing its disagreement with the injunction and stating that it  is currently considering all of its legal options.

For updates on the Overtime Final Rule, visit www.dol.gov.