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Biden’s labor rule mandates wage increases in higher education

Colleges and universities across the United States are preparing for a significant change in labor laws as the Biden administration’s new rule takes effect.

The rule, issued by the U.S. Department of Labor, requires higher education institutions to provide either a raise or overtime compensation to thousands of admissions officers, student affairs professionals and athletics staffers. This move marks a substantial shift from previous regulations, impacting millions of American workers across the country.

Biden's labor rule mandates wage increases in higher education
(Photo: WIKIMEDIA COMMONS / The White House)

Impact on higher education

The new rule, with an implementation deadline of January 1, 2025, requires employers to increase the minimum wage threshold for exempt employees to $58,656, a significant increase from the previous threshold of $35,568. This change will impact a wide range of higher education employees, including those previously exempt from overtime pay requirements.

This poses a significant challenge for many colleges and universities. The higher education sector is already struggling with declining enrollments and underfunding by states. The sudden increase in labor costs will put additional pressure on budgets, potentially leading to cuts in services, reduced financial aid and higher tuition.

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Challenges and concerns

One of the biggest challenges colleges and universities face is the short timeline for compliance. With less than a year to adapt to the new rule, institutions must quickly assess which employees will be affected and determine the best course of action. This may involve raising salaries, more closely tracking work hours or, in some cases, letting employees go.

Opponents of the ruling argue that it goes too far, too fast and will force university leaders to come up with millions of dollars in pay increases at a time when resources are already limited. However, organizations representing lower-paid higher education workers see the rule as a step in the right direction, benefiting those who are currently overworked and underpaid.

Legal and administrative hurdles

The new rule is likely to face legal challenges, similar to previous attempts to update labor law. Experts believe the rule could be challenged in court, which could delay or block its implementation. The conservative-leaning court and the relatively recent increase in the threshold from $23,660 to $35,568 during the Trump administration could make it more difficult for the Biden administration to survive legal scrutiny.

Despite the potential legal challenges, some experts believe the rule has a good chance of surviving lawsuits. The phased implementation, which updates the minimum salary based on the 20th percentile of weekly wages in the lowest-wage region, could help the rule overcome legal challenges.

The Biden administration’s new labor rule marks a significant change for colleges and universities across the country. While it aims to provide fair compensation to employees, especially those who are currently overworked and underpaid, it also poses challenges for institutions already facing financial constraints. As the implementation deadline approaches, colleges and universities will need to carefully assess the impact of the new rule and make strategic decisions to comply with the regulations while maintaining their core mission of serving students and advancing research.

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