The Chicago Tribune reports that a lawsuit was filed this week that attempts to force a retailer - in this case Chipotle, though the suit could have implications for virtually every business that pays hourly wages - to expand the number of people to whom it pays overtime wages.
The case has to do with a Labor Department rule instituted during the Obama administration saying that businesses should pay overtime to any employee working more than 40 hours a week and making less than $47,476 a year, up from the previous level of $23,660. The Tribune writes that "the lawsuit claims that while the injunction blocked the Labor Department from enforcing the rule, it did not technically prevent the rule from going into effect. The lawyers argue that the Labor Department does not have to take any further steps to implement the rule because it was already finalized and officially published by the time the injunction was filed ... The order was meant to give the court more time to reach a final decision on the regulation, which was challenged by 21 states and a coalition of business groups, including the Chamber of Commerce. The result was a limbo where the rule was put on hold but not permanently eliminated, according to legal experts not associated with the case."
The case has to do with a Labor Department rule instituted during the Obama administration saying that businesses should pay overtime to any employee working more than 40 hours a week and making less than $47,476 a year, up from the previous level of $23,660. The Tribune writes that "the lawsuit claims that while the injunction blocked the Labor Department from enforcing the rule, it did not technically prevent the rule from going into effect. The lawyers argue that the Labor Department does not have to take any further steps to implement the rule because it was already finalized and officially published by the time the injunction was filed ... The order was meant to give the court more time to reach a final decision on the regulation, which was challenged by 21 states and a coalition of business groups, including the Chamber of Commerce. The result was a limbo where the rule was put on hold but not permanently eliminated, according to legal experts not associated with the case."
- KC's View:
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It seems unlikely that the Trump administration won't do what it needs to do to vacate the new regulations now that a potential hole in the process has been identified by some lawyers. The Tribune notes that "during his confirmation hearing in March, Labor Secretary Alexander Acosta said it was 'unfortunate' that the rule had not been updated in more than a decade, but he also said the threshold proposed by the previous administration may 'create a stress on the system'."
