Legislative lowdown: The Department of Labor revisits Biden-era overtime rule

The Trump administration is reconsidering a Biden-era rule that would’ve extended overtime pay to millions of workers.

In an April 24 filing, the Department of Labor (DOL) asked the 5th Circuit Court of Appeals to temporarily suspend its appeals in two cases challenging the rule, which was finalized in April 2024.

The DOL said it was moving to hold off on these appeals pending the agency’s reconsideration of the rule challenged in these cases.

What the overtime rule would’ve done. The Biden-era rule raised the salary threshold for white-collar (i.e. executive, administrative, and professional) employees to qualify for overtime from $35,568 to $58,656. The change was expected to extend overtime pay to an additional 4 million workers.

While the federal government expected to fully implement the new rule by Jan. 1, 2025,a federal judge in Texas blocked it from taking effect this past November. The judge ruled that the DOL overstepped its authority in issuing a rule that prioritized salary over job duties in determining the overtime threshold for these workers, and returned the threshold to $35,568.

In a separate case, a different federal judge in Texas sided with a marketing agency that had challenged the Biden overtime rule, vacating it in a decision issued in December 2024.

The DOL appealed both of those cases to the 5th Circuit.

Trump’s DOL looks likely to drop the rule. While the first iteration of the rule took effect on July 1, 2024—bumping the overtime threshold up to $43,888—employers only had to comply with this policy for a few months before the 2019 overtime threshold of $35,568 returned.

Under the Biden-era rule, covered employers had to determine if they had the budget to raise workers’ salaries above the new threshold, or otherwise reclassify them as non-exempt hourly employees, HR Brew reported. It appears unlikely, though, that HR teams will have to resume this process under the Trump administration.

The DOL could, of course, move to change the overtime threshold from the current minimum of $35,568, so compliance pros should continue keeping an eye out for updates.

A number of the Biden administration’s labor and employment policies were already facing legal challenges last year, and seem unlikely to survive much longer in light of the presidential transition. The DOL also recently announced its staff will no longer consider Biden’s independent contractor rule in enforcement matters.