Federal Judge Blocks Implementation of Overtime Rule Set for December 1

by | Nov 28, 2016 | Labor and Employment Law

A federal judge in Texas has issued a nationwide preliminary injunction against the U.S. Department of Labor’s new overtime rule set to go into effect this week.  The new rule, which increases the minimum salary required to be paid to white collar exempt employees to $913 weekly ($47,476 annually) on December 1, was preliminarily found by the judge to be an overreach by the DOL of its rule-making authority.

The preliminary injunction is temporary in nature until the judge holds a hearing on the merits.  It is unknown at this time how the issue will be fully adjudicated and whether the final rule will withstand judicial scrutiny.

Employers who have scheduled payroll changes to be made to comply with the rule on December 1 should carefully consider their options.  If the rule is upheld and December 1 implementation is found to have been appropriate, there may be some exposure for employers who delayed the changes.

Additionally, if employers do not make the changes they have already communicated to employees, they will need determine how best to communicate the retractions to affected employees from an employee relations perspective.

Employers should carefully evaluate and examine their options before making decisions as to how to move forward with changes, or not, on December 1.

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