On November 22, 2016, a federal judge from the Eastern District of Texas issued a preliminary injunction against the Department of Labor’s new federal overtime rule. This preliminary injunction will be enforced nationwide.
The new overtime rule was set become effective on December 1, 2016, and it would have raised the salary requirement for employees eligible for overtime pay from $23,660 to $47,476. The rule also provided for triennial adjustments based on the 40th percentile of weekly earnings of full-time salaried employees in the lowest-wage Census region.
On October 21, 2016, twenty-one states filed an emergency motion for a preliminary injunction. In their motion, the states argued that the Fair Labor Standards Act (FLSA) does not authorize either the salary-level test or the rule’s triennial automatic increase of the salary threshold. The states also argued that the new overtime rule infringed on their sovereignty, in the rule’s application to state employees.
This ruling was a surprise to most employers across the country. Although this is a huge win for employers, the preliminary injunction is not permanent and the new overtime rule could be implemented in the future. For now, employers are only required to follow the existing overtime regulations.
For additional information on this or any related topic, please contact Indiana labor and employment law attorney Olivia Robinson at (812) 423-3183 or orobinson@KDDK.com, or contact any member of the KDDK Labor and Employment Law Practice Team.
About the Author
Olivia Robinson is an Indiana labor and employment law attorney who leverages her strong legal research, organization and communication skills as she advises employers on avoiding and defending against harassment, discrimination, retaliation, and other employment-related claims in federal and state courts and before local, state and federal administrative agencies.