Texas Federal Court Blocks Overtime Rule; Employers Off the Hook on December 1 Changes (For Now)
Yesterday, a federal judge in Texas issued a temporary nationwide injunction preventing the U.S. Department of Labor’s (DOL’s) overtime rule from taking effect on December 1. We discussed both the lawsuit and the final rule previously, and also provided a Q&A about these changes.
Employers across the country have been scrambling to ensure that workers currently covered by the executive, administrative, or professional exemptions (also known as the “white collar” exemptions) to the Fair Labor Standards Act (FLSA) would remain exempt. The final rule issued by DOL back in May would have raised the salary threshold – the minimum amount that employees must earn to be exempt from overtime pay under the white collar exemptions – from $455 per week ($23,660 per year) to $913 per week ($47,476 per year) beginning December 1.
DOL estimated that more than four million workers would become entitled to overtime as a result of the new rule, and that employers would convert the vast majority of workers currently earning less than $913 per week to hourly status (rather than increase their salaries).