San Francisco partner Cheryl Orr was quoted in a Human Resource Executive Online article titled, “Challenging the Overtime Rules.” Though the DOL’s new overtime rules are scheduled to go into effect December 1, two pending lawsuits may impede the effective date. Twenty-one states and nine advocacy organizations have come together to challenge the dramatic increase in salary employees may receive in overtime, question the legality of automatically raising salary levels every three years, and argue that the new rules violate the Constitution’s Tenth amendment.
Cheryl noted that though the states may have a stronger argument than private employers regarding the alleged Tenth Amendment violation, she anticipates appeals. Cheryl stated that many employers have worked through the economics and created an action plan and that’s there still time for those that haven’t. She also advises delaying any salary increase announcements.