About 16,000 Mainers who expected pay hikes this week will miss out on the extra wages.
A federal judge in Texas last week postponed implementation of the new Obama administration rules that increased the number of workers who qualify for mandatory overtime.
The U.S. Department of Labor’s controversial rule was set to extend mandatory overtime pay to 4.2 million salaried workers Dec. 1. The preliminary injunction issued last week by U.S. District Judge Amos Mazzant puts that on hold, creating some confusion for employers who now await further court proceedings over the Labor Department’s ability to implement the rules.
The rule would have doubled to $47,500 the maximum salary a worker can earn and still be eligible for mandatory overtime pay. The new threshold would have been the first significant change in four decades.
It was expected to touch nearly every sector of the U.S. economy and have the greatest impact on nonprofit groups, retail companies, hotels and restaurants, which have many management workers whose salaries are below the new threshold.
The left-leaning Economic Policy Institute in a broader analysis estimated that about 46,000 workers in Maine would be affected, either by qualifying for time-and-a-half pay for working over 40 hours in a week, having hours scaled back to 40 hours while making the same pay or getting a raise to put them above the income threshold.
Labor groups in Maine praised the rule after it was announced, saying it was long overdue. Business groups opposed the change and pushed for Congress to stop or modify it. Gov. Paul LePage also signed onto the lawsuit personally, joining a number of states or governors who joined the suit as plaintiffs.
The delay means a wait for employers, too, who had prepared for the Dec. 1 enactment of the new overtime rules.
A spokeswoman for the Maine Department of Labor told CBS 13 the department will mail information to Maine employers about the overtime rules as well as the voter-approved minimum wage hike that will begin Jan. 1 with an increase to $9 per hour.
For now, employers and employees will continue to operate under the previous mandatory overtime threshold of $23,750 per year.
Reuters contributed to this report.