Press Releases

News from EPI With federal progress on overtime stalled, states can and should take action

On August 31st, 2017, a district court in Texas found the Labor Department’s overtime rule to be invalid, taking away the new or strengthened right from 12.5 million workers to be fairly compensated for their overtime hours. The 2016 rule, which would have raised the salary threshold below which workers are automatically eligible for overtime pay—from $23,660 to $47,476 per year—would have restored a crucial protection to working people in every state. DOL is appealing the court’s decision, but the Trump administration is likely to issue a new rule setting the threshold at a much lower level. Even before the district court ruling, DOL had begun reevaluating the rule, citing concerns that the 2016 threshold was “too high.”

“The Trump administration is now actively working to undermine and weaken the overtime rule,” said EPI Policy Director Heidi Shierholz. “Since DOL is not going to vigorously defend the strengthened rule, states can and should act on their own accord.”

With progress at the federal level stalled, EPI and the Economic Analysis and Research Network (EARN) have released a briefing paper and detailed policy and legislative guidance for state policymakers to intervene where federal policy has failed.

“From the minimum wage to paid sick leave, states have a long track record of filling the void when federal labor standards lapse,” said Dianne Stewart, Director of the Economic Analysis and Research Network. “EPI and state EARN network partners are actively working with state policymakers and activists to make sure state economies work for working people.”

There are several actions state policymakers and activists can take to restore overtime protections, including:

  • Passing legislation providing the protections that the federal overtime rule would have provided to workers. The strongest action states could take at this moment would be to pass legislation raising the state overtime threshold, following the parameters of the 2016 federal overtime rule.
  • Launching a ballot initiative so that voters can weigh in to provide the protections that the federal overtime rule would have provided to workers. In states that are amenable to ballot initiative campaigns, groups could place an initiative on the ballot to raise the state’s overtime threshold to provide more low- and moderate-wage workers with overtime pay.
  • Extending overtime protections through executive action. In some states, the overtime salary threshold may be changed through an administrative regulation.

The guidance published today provides a road map for updating the threshold, including legislative language and guidance for updating the threshold administratively.