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USDOL Appeals Last Week's Exemption Ruling

The U.S. Department of Labor has filed its notice to appeal last week's preliminary injunction that prevented the salary-related changes in the federal Fair Labor Standards Act's "white collar" exemptions from taking effect today.

Labor Department Announces Intent to Appeal Preliminary Injunction of Overtime Regulations on the Day the Regulations Were to Become Effective

On December 1, 2016, the U.S. Department of Labor (DOL) filed a notice with the U.S. Court of Appeals for the Fifth Circuit announcing its intent to challenge a Texas district court’s issuance of a nationwide preliminary injunction blocking the implementation of revised overtime regulations under the Fair Labor Standards Act (FLSA). Ironically, December 1 was supposed to be the effective date for the revised regulations, which would more than double the minimum salary requirements for the FLSA’s major white collar exemptions.

Dec. 1 DOL Overtime Rule Blocked: Now What?

Just days before the Department of Labor’s (DOL) final overtime rule was scheduled to go into effect, a U.S. District Judge in the Eastern District of Texas issued a preliminary injunction, blocking the rule from taking effect across the country. Employers now face a number of legal, practical, and morale issues as they await a final decision in the matter.

DOL Issues Response to Recent Injunction Over Overtime Final Rule

Earlier today, the United States Department of Labor issued a written public response on its website to the injunction issued by Judge Mazzant enjoining the enforcement of its Overtime Final Rule, that was set to become effective on Thursday. The DOL response is set forth below and stated:

OT Aftermath: FAQs On How Employers Should Respond To Overtime Rule Decision

Employers are returning from their Thanksgiving holiday weekend grappling with thorny questions following last week’s surprising and momentous court decision preliminarily blocking the Department of Labor’s overtime rule from taking effect. Here are some answers to your most pressing questions from our firm’s thought leaders on the subject.

The DOL Overtime Salary Regulation is Temporarily Enjoined - Now What?

On Tuesday, November 22, 2016, a federal court in Texas issued a preliminary injunction temporarily barring the Department of Labor from implementing the December 1, 2016 salary rate increase for the white collar overtime exemptions. What will happen next is not certain, and depends in part on the Trump administration reaction after the inauguration. Many employers are considering pulling back previously-announced salary increases and re-classifications. When evaluating this option, employers should consider not only the uncertainty of the law at the federal level, but also state-law limitations on an employer’s ability to change pay terms for at-will employees.1

Obama Appointee Trumps Implementation of DOL's Salary Hike

Since 2014, employers have been preparing for, and many have already communicated or implemented, classification and compensation changes to comply with the U.S. Department of Labor's revised regulations, which would double the minimum salary required for certain exempt employees effective December 1, 2016. For more information concerning the changes, see our May client alert on this topic. Yesterday, a federal judge in Texas issued a nationwide preliminary injunction blocking the DOL from implementing the minimum salary hike from $455 weekly ($23,660 annually) to $913 weekly ($47,476 annually). State of Nevada et al. v. U.S. Department of Labor et al., No. 4:16-cv-731 (E.D.Tex. November 22, 2016).

New White Collar Regulations Blocked by Federal Court: What Do you Do?

Ten days before their December 1 effective date, a federal district court in Texas enjoined enforcement of the regulations increasing the salary level for white collar employees to qualify for the overtime exemption under the Fair Labor Standards Act (FLSA). Late on November 22, 2016, federal Judge Amos Mazzant (a President Obama appointee) issued a preliminary injunction preventing the U.S. Department of Labor (DOL) from enforcing these regulations on a nationwide basis.

Employers are not yet required to pay overtime in accordance with the revised FLSA regs . . . but proceed with caution.

By now, employers know that on November 22, 2016, federal court Judge Amos Mazzant in Texas issued a preliminary injunction that has blocked – temporarily – the implementation of the revised white collar overtime regulations issued by the Department of Labor (DOL) earlier this year. Those regulations, which have been the focus of concern, controversy, and downright panic, were set to become effective on December 1, 2016.

FLSA Salary Changes Halted For Now

Yesterday afternoon, Texas federal District Judge Amos Mazzant preliminarily enjoined the U.S. Labor Department from "implementing or enforcing" the salary-related changes in the federal Fair Labor Standards Act's "white collar" exemptions that were supposed to take effect on December 1. His decision was made in response to an emergency motion by the 21 states that had filed suit seeking to invalidate the Labor Department's actions.