NAHB Joins Lawsuit Challenging New Overtime Rules

The builders group has joined other organizations opposing the Department of Labor’s changes in overtime rules.

The National Association of Home Builders has joined a group that includes the Associated Builders and Contractors and the National Association of Wholesale Distributors in a suit filed in the U.S. District Court for the Eastern District of Texas that alleges the labor department exceeded its authority and “acted arbitrarily and capriciously.”

The new regulation, which addresses overtime pay and goes into effect on July 1, 2024, raises the salary level for determining when overtime must be paid and is set to increase again on Jan. 1, 2025. Starting in 2027, salary levels will be updated every three years.

The lawsuit charges that “many employers will lose the ability to effectively and flexibly manage their workforces upon losing the exemption for frontline executives, administrators and professionals. Millions of employees across the country will have to be reclassified from salaried to hourly workers, resulting in restricted work hours that will deny them opportunities for advancement and hinder their job performance—to the detriment of their employers, their customers and their own careers.”

The home builders group said the new rule’s salary requirement “is so excessive that it overwhelms the original intent of the overtime exemption, which was to exempt employees in executive, administrative and professional jobs from overtime pay requirements.”

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