Martha Zackin

Overtime Update: Will the Texas Decision Invalidating the DOL Overtime Rule Survive and What Should Employers Do Now?

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By Kenneth M. Bello

Now that a federal judge has issued a preliminary injunction staying implementation of the new DOL regulations revising salary thresholds for determining application of the white collar minimum wage and overtime pay exemptions, otherwise slated to go into effect on December 1st, what happens next, and how quickly will that occur?  Here are the possibilities.

  • An interlocutory appeal to the 5th Circuit Court of Appeals. How that comes out is anyone’s guess, but the case is vulnerable in its analysis, as detailed below.
  • Congressional Action that renders the decision academic. On September 28, 2016, the House of Representatives passed H.R. 6094, titled Regulatory Relief for Small Business, Schools, and Nonprofits Act.  The bill would have changed the effective date of the revised overtime regulations from December 1, 2016 until June 1, 2017.  With a Republican majority in both the House and Senate, there is a very real possibility that some form of law will be filed and passed in 2017.  The question of course is what will that bill look like – for examples, will it exempt “small business”, and will it change the minimum salary amounts and/or remove automatic indexing?

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Martha Zackin

DOL Overtime Rule Stopped: Nationwide Injunction Issued by Texas Judge

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In a last-minute, and therefore surprising, decision issued today, a Texas Federal District Court judge has blocked enforcement of the revised federal overtime rule set to become effective December 1, 2016.  The rule, issued by the federal Department of Labor, would require employers to pay a salary of at least $913 dollars per week (equivalent to $47,476 per year), to most employees treated as exempt from overtime pay under the Fair Labor Standards Act, a significant increase over the current $455 per week ($23,660 annually).  The ruling came in response to cases filed in the last several weeks by certain groups of states, and the decision to issue the injunction has surprised some commentators.

Despite being issued by a single Texas trial court judge, the injunction ostensibly has nationwide effect, and completely prevents the DOL from enforcing the revised rule, just days before it was scheduled to take effect.  It remains to be seen whether an immediate appeal will follow, and ultimately whether the injunction will be upheld.  Employers that have not already implemented changes to employee pay or classifications will need to make decisions regarding whether to go ahead with changes in the face of this uncertainty.  We will continue to provide updated analysis and will be available in the coming days to discuss these developments with any clients seeking guidance in making these decisions.

 

Martha Zackin

EEOC Publishes Strategic Enforcement Plan for Fiscal Years 2017-2021

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By Martha J. Zackin

EEOC recently published its Strategic Enforcement Plan (SEP) for Fiscal Years 2017-2021, in which it outlines the areas in which it intends to focus its strategic litigation and enforcement activities in the coming years.  Not surprisingly, the EEOC indicates that it intends to expend significant resources on understanding and protecting temporary employees and members of the gig workforce.

As described in the SEP, EEOC’s substantive priorities for Fiscal Years 2017-2021 are: Read more →