PA Department of Labor & Industry Re-Submits Overtime Rule Proposal

From PA Chamber of Business & Industry

Following a directive from the state’s Independent Regulatory Review Commission to address concerns raised over its initial proposal and engage in additional stakeholder outreach, the PA Department of Labor & Industry issued an updated proposal to change the state’s overtime eligibility rules. 

By way of background, in 2018, the PA Department of Labor and Industry proposed new rules related to employee eligibility for overtime pay, including doubling the minimum salary threshold required for exempt status and requiring regular threshold increases. The PA Chamber, along with hundreds of other employers and advocates, submitted comments to the Independent Regulatory Review Commission expressing concerns, and ultimately IRRC issued its own comments with a significant number of questions and suggestions. Among IRRC’s directives to the Department was more robust stakeholder outreach and in May and June of this year, the Department conducted a series of employer roundtable meetings throughout Pennsylvania. 

Unfortunately, the Department’s latest iteration of the proposal largely ignores the feedback provided by employers during the stakeholder engagement process.  The updated proposal offers minimal changes to the original draft with only a slight reduction to the proposal salary threshold.  As currently written, the proposed rules would still have a profoundly negative impact on a wide range of industries and employees. 

The Department’s proposed rule is also far more aggressive than a new rule issued by the federal government which included significant, albeit more reasonable, changes to the federal overtime rule.  That means the state rule, if implemented, would not only adversely impact employers and the workplace, but also harm Pennsylvania’s competitiveness compared to other states.

Following the release of the updated proposal, PA Chamber President and CEO Gene Barr issued a statement urging IRCC and “lawmakers to consider the true impact of this proposal and reject it.”