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After Overtime Rule Is Blocked, Some Employers Face Tough Choices

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They can backtrack on promises … but should they?

A judge’s decision to block a new set of overtime rules has left many businesses across the U.S. with some tough choices.

The new Department of Labor rules would have made workers eligible for overtime pay if their salary was under $47,476 per year a year. The current threshold is $23,660 a year.

But a federal judge in Texas blocked the rule from taking effect Dec. 1 as had been set to do, Marketplace.org reports. Judge Amos L. Mazzant III issued a preliminary injunction after following complaints about the rule by business groups and some state attorneys general.

The problem is, many employers had already been preparing to deal with the new rules.

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Some had promised raises to employees to get them above the threshold so they could still be exempt from overtime regulations. Others had planned to begin paying overtime to affected employees, Marketplace.org explains.

Legally, employers have the right to go back on those promises. But the decision of whether to do so has to be made with employee morale in mind, too, says Kerry Lear of Mammoth HR.

“Especially where they went ahead and increased the salaries of some of their workers, those employers are going to be hard-pressed to take those salaries back down,” Lear told Marketplace.org.

Read more at Marketplace.org

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