DOL Overtime Rule Blocked by Federal Court
On Tuesday, the United States District Court for the Eastern District of Texas issued a decision enjoining the Department of Labor (DOL) from enforcing its new overtime rule.State of Nevada et al. v. U.S. Department of Labor et al., case number 16-cv-00731. The new rule, which was announced in May 2016 and was set to become effective on December 1, 2016, sent employers scrambling to comply with a substantial increase to the minimum salary requirements for the white collar exemptions. In his decision, the judge held that the DOL had exceeded its authority in issuing the rule.
Because the DOL is enjoined from enforcing the new rule on a nationwide basis, employers need not comply with the December 1, 2016, implementation date. However, as this was only a preliminary injunction, employers are not out of the woods yet, and the possibility remains that the rule may still be enforced as written. The injunction will remain in effect until a final resolution of the merits is reached or there is further order of the court, the Fifth Circuit, or the United States Supreme Court.