By Sara J. Ackermann
September 8, 2017
Finally, it appears we have closure on this saga that started over a year ago! On August 31st, the same Texas federal district court judge who granted a preliminary injunction last November delaying the effective date of the Department of Labor’s new overtime rule, issued a final judgment invalidating the rule. As you may recall, the Obama-era overtime rule attempted to:
- double the minimum salary required for exemption from overtime of executive, administrative, and professional employees from $455 to $913 per week.
- establish a mechanism to automatically update the salary and compensation levels every three years.
In his decision, the district court judge concluded that:
Congress unambiguously directed the [DOL] to exempt from overtime pay employees who perform bona fide executive, administrative, or professional capacity duties. However [the new DOL rule] makes overtime status depend predominately on a minimum salary level, thereby supplanting an analysis of an employer’s job duties. . . . Because the [rule] would exclude many employees who perform exempt duties, the [DOL] fails to carry out Congress’s unambiguous intent.
For similar reasons, the judge struck down the automatic salary updates as well.
What Wisconsin employers need to know: Whether the DOL under the current administration will propose any overtime rules remains to be seen, but we do not anticipate any major changes in the foreseeable future. We will keep you posted on further developments! If you have questions, contact your favorite employment law attorney!
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