States Address Salary Threshold for Overtime

Some state governments have decided to take the lead on the salary threshold that governs overtime pay as the Department of Labor (DOL) contemplates a new rule.

In August 2017, a federal judge in Texas struck down the Obama Administration's controversial rule expanding the number of employees that are entitled to overtime pay. The regulations would have dramatically increased the salary threshold for exempt employees to $47,476 per year from $23,660. Subsequently, the Trump DOL requested comments from stakeholders to inform a regulation with a more modest increase to the salary threshold—Secretary of Labor Alexander Acosta has floated a salary threshold of $33,000.

Eight states, however, currently have laws that raise the threshold for overtime exemptions above the national level: Alaska, California, Colorado, Connecticut, Iowa, Maine, New York and Oregon. Additionally, Arizona, Hawaii, and Pennsylvania have introduced bills in their state legislatures that would do the same. 

In its comments submitted to DOL in September 2017, NATSO urged the Department to refrain from making dramatic changes to the Overtime Rule that would expand the universe of employees eligible for overtime pay. The Department is expected to make additional announcements on its own revisions to the rule in the coming months. Read NATSO’s comments to the Department of Labor regarding overtime.

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