Court Enjoins New Overtime Rules

In may, we published a post about new overtime rules and how they may affect ASA members.

In essence, the new overtime rule would have a taken some of the people who are currently exempt from overtime protection (like “outside salesmen” and executive, administrative, or professional employees) and would have un-exempted those below certain salary levels.

A federal court in Texas has enjoined enforcement of the overtime rules on an emergency basis.  The Court concluded that overtime exemption statute (29 U.S.C. § 213(a)(1)) does not grant the Department
of Labor the authority to add a salary-level test or an automatic updating mechanism to the standards found in the statute. Those who are exempt remain exempt.

This is a temporary injunction.  It is based on a conclusion that there is a strong likelihood that the states who are suing will prevail on the merits, but it is is not a final judgment on the merits.

ASA members who were planning to implement new overtime rules for their personnel in compliance with this new regulation should refrain until the final decision of the court.

Although the matter was adjudicated in Texas, the Texas federal court has the authority to issue a nationwide injunction and the Court’s order specifically stated that the injunction is issued on a nationwide basis.