On August 31 a federal judge in Texas struck down a Department of Labor (DOL) rule from the previous administration regarding who must be paid overtime. The rule proposed doubling the salary under which workers are automatically entitled to overtime pay, to $47,000 per year. This could have forced employers to limit hours, reduce base pay, or lay off employees to meet payroll costs.
The rule was initially put on hold in November 2016 following a lawsuit brought by a broad coalition of national and local business groups, which argued that the DOL exceeded its statutory authority in issuing the regulation. The Fair Labor Standards Act generally requires employers to pay workers overtime for all hours worked beyond 40 per week. The overtime standards created in 2004 by the Bush administration allow employers to exempt workers who make more than $23,500 annually and serve in “bona fide executive, administrative, or professional” positions.
This decision brings certainty to ICSC members for now. The Trump administration has indicated it may consider issuing a new rule with a more moderate increase to the salary threshold.
In other workforce news, on July 27 Rep. Bradley Byrne (R-AL) introduced H.R. 3441, “The Save Local Business Act of 2017.” The bill is in response to a National Labor Relations Board decision in 2015 to expand the definition of a “joint employer,” causing ICSC members great concern about their ability to operate as independent entities and jeopardizes current and future contractual relationships. The broadening of what constitutes a “joint employer” means shopping center owners, service providers and tenants throughout the country that rely on contractors and subcontractors may be held liable for the actions of those with whom they contract or the venues in which they operate.
ICSC believes this bipartisan legislation, which codifies the previous, narrower definition of “joint employer,” will provide needed clarity to America’s shopping center owners, service providers and tenants. The bill defines the “joint employer” relationship as one where there is “direct, actual and immediate” significant control exercised over the primary elements of employment, such as hiring, firing, determining pay, or supervising employees on a routine basis.
ICSC applauds Rep. Byrne and the 43 current cosponsors of this legislation and will continue to work with Congress towards its enactment.