Employers and their employees are likely to respond to an anticipated and controversial overtime rule in unintended ways, according to a new study from the Mercatus Center at George Mason University in Arlington, Va.
As proposed, the rule recommends setting the salary threshold for exempt employees at $50,440 annually, up 113 percent from the current $23,660 annually. It also calls for annual automatic increases to the salary threshold.
In response to the regulation, employers may reduce base salaries, cut overall compensation and replace workers with machines or higher-skilled workers, the April study found.
