Judge Blocks FLSA Overtime Rule
Last week, a Texas federal judge ruled to strike down a Department of Labor (DOL) overtime rule that would have expanded the number of workers eligible for overtime pay under the Fair Labor Standards Act (FLSA), starting on January 1, 2025. The judge also overturned the initial increase under this rule that went into effect on July 1. As a result, the salary increase that was scheduled to commence on January 1, 2025 is unlikely to take effect.
Why does this matter?
This ruling means that nonprofits, along with other employers, are not required to follow the anticipated increased salary threshold of $1,128/week ($58,658/year) for overtime eligibility. The threshold is set to revert to the level it was before July 1, 2024, requiring employees to earn at least $684 per week ($35,568 annually) to qualify as an exempt employee.
While nonprofits are no longer required to implement the higher salary thresholds or adjust employee pay in the future, they should avoid reversing recent salary increases made in anticipation of the changes. Any operational changes that were made to comply with the overtime rule should also be reassessed to ensure they support staff and organizational well-being. Nonprofits should continue to remain vigilant about potential future changes, as the Department of Labor (DOL) is likely to appeal the judge’s recent decision, which could lead to further adjustments down the line.
H.R. 9495 Action Alert
The U.S. House is expected to vote on H.R. 9495, the “Stop Terror-Financing and Tax Penalties on American Hostages Act” in Congress tomorrow. The bill would grant the Secretary of the Treasury the authority to revoke the tax-exempt nonprofit status of any organization deemed a supporter of terrorism with minimal due process and without disclosing evidence. The burden of proof would be on the nonprofit to disprove any allegations of terrorism. We encourage you to read the joint statement issued last week by the National Council of Nonprofits, Council on Foundations, Independent Sector, and the United Philanthropy Forum opposing H.R. 9495.
In a recent procedural vote, Oregon Congressional Representatives Blumenauer, Bonamici, Hoyle, and Salinas opposed this bill, while Representatives Bentz and Chavez-DeRemer voted in support.
TAKE ACTION
Contact your Congressional Representative today! Urge them to oppose H.R. 9495.