Overtime Rule Is Postponed Indefinitely
You don’t have to implement any changes to your staff salaries or overtime hour tracking because the overtime final rule itself has been postponed, The Business of Medicine has learned. A federal judge from Texas granted an emergency motion for an injunction to block the U.S. Department of Labor from implementing the rule, which was scheduled to take effect Dec. 1.
This means the overtime rule won’t be in effect until after a hearing, which could take more than a month, making it extremely unlikely for the overtime rule’s future to be decided until after Jan. 20, when President-elect Donald J. Trump is sworn in. President Obama’s labor secretary, Thomas Perez, has already moved to request an expedited hearing before Trump’s inauguration, but the courts have no particular incentive to move quickly on a law with national consequences that would most likely be opposed by the incoming administration. Trump has stated in the past that he opposes the overtime rule, which more than doubles the salary threshold above which employees would be exempt from getting overtime pay.
The current threshold is $23,660, which means anyone making more than that amount annually may not have to be paid for overtime (defined as the number of hours in excess 40 per week). The final overtime rule sets the threshold to $47,476, and many medical practices have had to decide whether to give employees close to that salary a raise, or to start tracking their hours so overtime can be paid.
Some practices have already implemented small raises of a few thousand dollars or less that put affected employees over that threshold. Most believe it would be bad for morale to reverse the raises just because the rule is now in legal purgatory.
At a 30-physician group practice in Rockford, Ill., a total of four employees were affected by the overtime rule, according to the group’s human resources director. One, a salaried surgical technician, was given a raise that put her over the new overtime threshold, but she was also given new job responsibilities to justify the raise. Two billing and coding staffers were in line to receive a raise that would get them over the threshold, but news of the injunction came before they were informed about the raise, so the practice decided to leave their salaries unchanged.
In only one case, a staffer was informed about her raise – approximately $2,900 – before the rule was put on hold, and she will retain the raise because reversing it wouldn’t be good for her morale.
For now, these individual decisions will be up to practices, and often they will need to make them on a case-by-case basis, but many other business are taking a wait-and-see approach with the Trump presidency fast approaching.
— Grant Huang, CPC, CPMA (email@example.com). The author is Director of Content at DoctorsManagement.