New FLSA Overtime Rule Stopped in its Tracks: Nationwide Injunction Issued

23Nov16

iStock_000000901325XSmallEmployers across the country have been busy preparing to ensure compliance with the new FLSA overtime final rule which required compliance by December 1, 2016.  However, they have now been given an early holiday present.  On November 22, 2016 a federal court judge for the Eastern District of Texas, Amos Mazzant, issued a nationwide injunction stopping implementation of this final rule.  With the new Trump administration coming in shortly appointing a new Secretary of Labor such a rule may never even be issued.

Thus, employers do not need to comply with the final rule effective December 1, 2016.  The final rule required employers to make a choice of whether to up the salary for the group of currently exempt employees making more than $455 a week but less than $913 a week who would now have to be reclassified as non-exempt or simply raise their salaries to meet the new threshold of making not less than $913 a week or $47, 476 annually . If employers have already made these changes, it would be best to consult with legal counsel prior to changing back.  However, for those employers who have not yet made these changes, no need to do so as of December 1, 2016.  A loud sigh of relief from many employers as a result of this injunction!

We will continue to keep you updated on this issue and provide you with our recommendations for ensuring compliance.

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