Judge Issues Injunction Against Overtime Rule
Late yesterday, a U.S. Judge in Texas issued a temporary injunction halting the Department of Labor’s overtime rule. The rule was scheduled to go into effect on December 1, 2016, and many organizations prudently implemented the rule in advance to ensure compliance. The injunction states that the Department of Labor does not have the authority to define salaried workers based on the amount of money they earn. Proponents of the injunction are claiming this gives the courts an opportunity to officially overrule President Obama’s agenda and allow time for President-Elect Trump to propose changes. Opponents are upset that many employees will be forced to continue working long hours for low pay.
If you have not yet implemented the changes in your organizations to comply with the new $47,476 salary threshold, you can now delay implementation until the courts make a final ruling. If you have implemented the rules in order to ensure full compliance by December 1st, you will need to assess the effect on employee pay and morale to determine if you should reverse implementation. Remember that this is an emergency injunction, and the law may still go into effect at a future date.
The experts at Ketel Thorstenson, LLP will continue to monitor this situation and keep you informed as new information is available.