DOL Appeals Decision to Delay Overtime Rule

Below is updated information on the new overtime law. We encourage you to attend our Educational Event where this topic along with recent changes in employment law & health insurance will be discussed.

An appeal by the Department of Labor challenging a district court ruling that delayed the agency’s new overtime exemption rule from taking effect was filed December 1 in the Fifth U.S. Circuit Court of Appeals.

The overtime rule, which was scheduled to take effect December 1, was blocked by a federal district court’s temporary injunction. The district court said the department exceeded its authority in establishing a salary threshold of $47,476, below which workers are eligible for overtime pay (Nevada v. DOL, E.D. Tex., No. 4:16-cv-00731, motion granted 11/22/16).

The district court ruled that the Department of Labor was not authorized to create a salary test and that the department should have focused on the actual duties that workers perform, instead of the salary they make, in determining whether a worker qualifies for an exemption to overtime pay requirement for “executive, administrative, or professional” employees.

The department’s interpretation of the Fair Labor Standards Act was not entitled to the deference that courts often give agencies with they try to iron out ambiguities in the laws they administer, the district court said.