If you were due to become eligible for overtime on Dec. 1, you might have received an unwelcome letter from HR this week. The gist: thanks to a ruling by a federal judge blocking President Obama’s addition to the Fair Labor Standards Act, employees making less $47,476 annually will not automatically be eligible for overtime pay.
But, of course, that doesn’t mean companies can’t give it to them anyway, or to raise salaries to the point where the new rule wouldn’t apply. For example, Walmart started raising its managers’ salaries three months prior to when the rule would take effect. Managers who previously would have made $45,000 annually received a raise to $48,500, reports Bloomberg BNA.
The retailer, which is the largest private employer in the U.S., does not plan to change that.
“We are reviewing the court’s ruling, but we don’t anticipate making any changes to what we’ve already shared with our associates,” Walmart spokesman Kory Lundberg told Bloomberg BNA.
Big Changes at Walmart
This is just the latest of several changes at Walmart over the past year under CEO Doug McMillon. The retailer previously raised wages for both managers and staff and introduced training programs and more flexible scheduling.
“We realized quickly that wages are only one part of it, that what also matters are the schedules we give people, the hours that they work, the training we give them, the opportunities you provide them,” said Judith McKenna, Walmart’s chief operating officer, in an interview quoted by The New York Times. “What you’ve got to do is not just fix one part, but get all of these things moving together.”
As a result, the company has seen an increase in sales and the percentage of stores hitting customer-service targets.
Other Retailers Are Also Rolling Out Raises
Walmart is not alone in holding steady, whatever the legal outcome for the overtime rule. The Hour reports that 56 percent of large retailers in a Hay Group survey say they will adhere to the new overtime requirements, despite the injunction.
One possible reason that many companies will hold to the new overtime threshold: simple convenience.
“The timing of this announcement and decision could not be much worse, and … has created a minor level of chaos at some businesses,” David Lewis, CEO of OperationsInc in Norwalk, told The Hour. “All these decisions had already been made — you are talking three or four months of preparation to get to this point.”
For workers whose employers are willing to go through the trouble of rolling back overtime, the next few months will be a waiting game. The Labor Department is currently appealing the injunction halting the overtime expansion.
Tell Us What You Think
Has this rule — or the injunction halting it — affected you? We want to hear from you. Tell us your thoughts in the comments, or join the conversation on Twitter.
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