Local employers brace for effects of pending overtime rule

“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.