After Trump's victory on Nov. 9, it's anyone’s guess what will happen with the new FLSA overtime rules until the Trump administration begins to address such issues sometime after January.
The Obama administration will most likely move forward with the new rules, and expect employers to reclassify employees to comply by December 1. There is speculation that the U.S. Department of Labor might not immediately begin to enforce penalties because of the possibility of the law changing under the Trump administration, but that is only speculation. The best advice for now is to stay on course and follow the plan you have set for December 1.
As it stands today, the DOL is adamant about enforcing the new FLSA rule, after all, it is the law. Even if the DOL does not actively enforce penalties because it anticipates eventual repeal, the fact remains that it is a law, and employers who do not comply could face potential lawsuits from misclassified employees.
What will you do if the new FLSA rule is repealed?
Of course that depends on the extent of the repeal.
The wage limits could:
- Be reset back to what they were prior to December 1, 2016
- Be reset to lower limits than the December 1 limits, with a more lengthy phase-in period
There are limitless combinations. But you may need to be considering your options -- will you lower wages of employees for whom you just raised them? Will you stop having employees clock in/out when you just went to a lot of trouble to start recording their time? Will you leave everything in place as you changed it at December 1 and be ahead of the game?
The DOL under the Trump administration will most likely be different than it has for the past eight years under President Obama.
DOL has greatly increased the number of field auditors and become much more aggressive in its enforcement actions in the recent past. It will be worth watching to see if this trend continues or not as the Trump administration settles in.
Obviously, the new administration will have their own ideas for DOL and it will take time to realize a new direction. FLSA overtime is just one of the hot topics they have to handle.