As we reported to you a couple of weeks ago, the United States District Court for the Eastern District of Texas issued a preliminary injunction blocking implementation of the federal DOL’s new overtime rule that was scheduled to go into effect on December 1, 2016. The new overtime rule would have more than doubled the minimum salary threshold for exempt employees from $455 per week ($23,660 annually) to $913 per week ($47,476 annually).
Last week, the DOL appealed the federal court’s decision to the U.S. Court of Appeals for the Fifth Circuit and requested that the court expedite the appeal process. Unfortunately, yesterday, the Fifth Circuit granted the DOL’s request and ordered an expedited briefing schedule. Based upon that schedule, the DOL’s opening brief is due on December 16, and the states’ brief supporting the District Court’s injunction is due on January 17, 2017. Oral argument will likely be heard in February or March. Even with this expedited schedule, President-elect Trump will take office on January 20, and future decisions on the overtime rule will be made by his administration. The Trump administration could choose to withdraw the government’s appeal and not challenge the District Court’s decision invaliding the rule.
While this appeal is pending, the federal minimum salary threshold for exempt employees remains $455 per week and $23,660 annually. PLEASE NOTE: Some state laws set higher minimum salary thresholds. As an example, as a result of a referendum Maine voters approved on November 8, the minimum salary threshold in Maine will increase to an annual salary of $27,000 in January ($519.24 weekly) and the annual salary will increase $3,000 each subsequent year until it reaches $36,000 in 2020. In New York, the minimum salary threshold was increased last year to $675 a week. Please also note, as previously discussed, that in addition to satisfying the minimum salary, an employee must also satisfy the job duties test to be exempt from overtime pay.
We will provide an update of any future developments regarding the overtime rule. For more information, please contact Peter Bennett (email@example.com) or Rick Finberg (firstname.lastname@example.org) of The Bennett Law Firm.