Punching In: Popularity of Overtime Pay Rules Meets the Courts

Monday morning musings for workplace watchers.

Overtime Rules May be Here to Stay | Congress Returns with Work to Do

Rebecca Rainey: Overtime pay rules are one of the top issues for voters in the 2024 election, according to polling conducted this summer by Navigator Research, a polling organization with ties to several left-leaning groups.

The surveys, taken in July and August, were focused on the policy ideas outlined in The Heritage Foundation’s Project 2025, which has connections to the Trump administration. (The Trump campaign has tried to distance itself from Project 2025.)

The polling reveals how the public is affected—both politically and personally—by policy changes to federal overtime pay requirements, an area of law that has been tweaked in some way by nearly every administration over the past two decades, with ensuing litigation in the courts. Broad support for overtime protections could help explain why former president Donald Trump has distanced himself publicly from calls to roll them back, and why the courts could be their biggest obstacle.

Some 84% of registered voters said that “allowing employers to stop paying hourly workers overtime” would hurt the country, according to a nationwide survey of 1,000 voters conducted by Navigator in late June.

Under the Fair Labor Standards Act, a law passed in 1938, any work an employee does after working 40 hours in a single week must be paid at 1.5 times their regular rate of pay.

Specifically, Project 2025 calls on Congress to change this provision for teleworkers so that overtime only applies “if the employee exceeds 10 hours of work in a specific day (and the total hours for the week exceed 40).”

And instead of looking at a single week to determine if a worker has gone over 40 hours, Project 2025 says “employers and employees should be able to set a two- or four-week period over which to calculate overtime.”

The change would result in less overtime premium pay for workers, which Project 2025 bills as providing “workers greater flexibility to work more hours in one week and fewer hours in the next” while employers wouldn’t be required “to pay them more for that same total number of hours of work during the entire period.”

Among other policy changes, the group also suggests employees in the private sector should have the ability to choose between “receiving time-and-a-half pay or accumulating time-and-a-half paid time off.”

Democrats are trying to contrast this policy pitch with efforts made by the Biden Labor Department to expand overtime eligibility to 4 million new workers.

It’s important to note that the last time Trump was in office, his DOL did move to expand overtime pay to more workers, albeit not as broadly as the Biden administration did earlier this year. And potential limits on the DOL’s ability to regulate overtime pay may already be coming, despite who is elected in November.

Federal courts are considering four pending challenges to both the Biden and Trump overtime rules—which both expanded or seek to expand overtime eligibility to more salaried workers. The lawsuits contend that the DOL doesn’t have the authority under the FLSA to make such changes to overtime pay eligibility. If those arguments were to prevail, DOL could no longer consider how much a worker is earning when determining overtime pay eligibility, which attorneys say would likely result in more workers being deemed ineligible for overtime.

The Congressional Budget Office released report projecting rising debt and deficits.

Photographer: Stefani Reynolds/Bloomberg

Diego Areas Munhoz: Congress is back this week with some labor items still on the to-do list.

Lawmakers are back to Washington for just three weeks before they break for the final run up to November elections. Federal agencies run out of cash after Sept. 30.

House Republicans have proposed drastic cuts to the US Department of Labor and the National Labor Relations Board. Their funding bill (H.R. 9029) was approved by the Appropriations Committee, but never saw a floor vote.

Meanwhile, senators are seeking to mostly keep funding as is, with some slight increases. The bill (S. 4942) advanced out of committee with a bipartisan vote, meaning it will likely be closer than the House version to what’s worked out between Democratic and Republican leaders.

The NLRB will be keeping an eye at a small provision in the funding bill. Senators included $5 million to modernize its outdated case management and information technology systems. The board received $23 million from a federal fund last week for an IT update, but in the form of a loan so they may still be interested in the extra cash from Congress.

The NLRB is also waiting on confirmation of two board members. The HELP Committee advanced Lauren McFerran and Joshua Ditelberg’s nominations, but they have yet to face a vote by the full Senate.

Meanwhile, the Workforce Innovation and Opportunity Act reauthorization is also high up on the task list. Sen. Bernie Sanders (I-Vt.) told Bloomberg Law in July that the panel he chairs—the Health, Education, Labor and Pensions Committee—would markup a WIOA reauthorization in September.

The House has already passed its version of the bill with an overwhelming bipartisan vote. WIOA funds the main federal workforce development program that advocates, employers, and lawmakers say is in desperate need of reform.

Senators are also aiming for a bipartisan bill and would like to see this done before the end of the year. But they will have to balance some opposition from both sides to the draft legislation they’ve circulated.

Unions and progressives want more organized labor representation on workforce boards, while some employer groups aren’t too happy with provisions to block faulty training providers from accessing WIOA that they say are “overly broad.”

Paid leave legislation is on the list of potentially more challenging items to accomplish this year, even as lawmakers in the House and Senate bipartisan working groups had expressed some optimism about passing modest legislation to increase access to the benefit and create more uniformity across the patchwork of state programs.

But they have yet to introduce legislative text, and time may be running out.

Lawmakers and advocates were also hoping to pass legislation to ban mandatory arbitration agreements in cases of age discrimination. The bill advanced out of the Senate Judiciary Committee in May on a bipartisan vote, but there remains some Republican opposition in the upper chamber and the House has yet to move on the legislation.

Rail safety legislation, a high priority for unions, has also been on the agenda for a while. Ohio Sen. JD Vance, the Republican vice presidential nominee, is a backer of the bill and advocates have said they hope his new status on the ticket may help move the bill forward. But rail companies and many republicans still stand in the way of passage.

We’re punching out. Daily Labor Report subscribers, please check in for updates during the week, and feel free to reach out to us.