NAA and NMHC Push Back on DOL Announcement Citing Supply Chain Disruption and Workforce Shortage Concerns

May 20, 2022 |

Updated May 20, 2022

2 minutes

Ninety-three organizations have asked the Department of Labor not to issue a new rule altering overtime regulations. 

NAA and NMHC joined 91 organizations on May 11 to request that the Department of Labor (DOL) abandon the issuance of new rule altering the overtime regulations under the Fair Labor Standards Act (FLSA). The letter makes the case that “due to significant concerns with supply chain disruptions, workforce shortages, inflationary pressures, and the shifting dynamics of the American workforce following the COVID-19 pandemic, any rule change now would be ill-advised.”

What This Means

This new effort by the Biden Administration could increase the salary threshold under which overtime must be paid from the present $35,568, irrespective of whether an individual is a manager or professional.

Why This Is Critical for Our Industry

Issuing a new rule with higher threshold limits could ultimately increase labor costs and reduce industry flexibility for industry employees. As the letter states, “DOL last updated the overtime regulations only three years ago, which strongly suggests there is no need for urgency in issuing more changes."

Our Take

NAA and NMHC have long worked on this issue dating back to when the Obama Administration issued a rule that would have significantly increased the overtime threshold. After extensive industry engagement, a final rule was issued in 2019 that was acceptable to the industry. NAA and NMHC will continue to make the case that a new rule is unnecessary.