On August 31, 2017, in State of Nevada et. al. v, United States Department of Labor et. al., pending in the United States District Court for the Eastern District of Texas, a Federal Judge ruled that the United States Department of Labor’s (“DOL”) changes to the Fair Labor Standards Act’s (“FLSA”) overtime regulations were unlawful. As you may recall, in May of 2016, the DOL issued a Final Rule, which among other things, increased the salary threshold for certain “White Collar Exemptions” from $455/week ($23,660 annually) to $913/week ($47,760 annually). The Final Rule also included a mechanism to automatically update the salary threshold every three years. The Final Rule was scheduled to go into effect on December 1, 2016.
In November of 2016, the same Federal Judge issued a nationwide injunction blocking the Final Rule from going into effect. The Judge’s August 31st Order goes further in ruling that the changes to the overtime regulations were unlawful, as the Final Rule failed to carry out Congress’ unambiguous intent as set forth in the language of the FLSA. The Judge also issued a Final Judgment dismissing the case with prejudice.
For now, the FLSA overtime regulations will remain the same, and the Final Rule will not being going into effect. It is unclear whether the DOL will appeal the Court’s decision, although it appears unlikely. The Final Rule was issued during the Obama administration, and the Secretary of Labor in the Trump Administration, Alex Acosta, has previously indicated that the DOL would be reconsidering proposed changes to the overtime regulations of the FLSA.