EMPLOYMENT LAW ALERT: FEDERAL JUDGE HALTS OVERTIME RULE
We last advised you that the Department of Labor’s final Rule updating the overtime regulations was to take effect on December 1, 2016. The overtime rule would have raised the salary threshold from $23,660 to $47,476 a year.
However, just 10 days before the implementation date, a federal judge in Texas issued a preliminary injunction preventing the new Rule from taking effect. Twenty-one states filed an emergency motion for a preliminary injunction in October to stop the Rule. They claimed that the DOL exceeded its authority by significantly raising the salary threshold and by providing for automatic adjustments to the threshold every 3 years.
All of the states’ cases were consolidated in October. In his November 22nd ruling, Judge Amos Mazzant of the U.S. District Court for the Eastern District of Texas said, “A preliminary injunction preserves the status quo while the court determines the department’s authority to make the final rule as well as the final rule’s validity.”
What is the effect of the Court’s preliminary injunction? For now, the overtime rule will not take effect as planned on December 1st. Thus, employers may continue to follow the existing overtime regulations until a decision is reached. However, employers should not assume that the overtime rule will be permanently barred.
We will keep you up to date on all future rulings.
Claire Saady is a partner in Saady & Saxe, P.A., and concentrates her practice in the area of employment law. She can be reached at firstname.lastname@example.org or 813-909-8855.