On November 22, 2016, Judge Mazzant of the Eastern District of Texas granted a preliminary injunction delaying the implementation of the U.S. Department of Labor’s (“DOL”) Fair Labor Standards Act (“FLSA”) Overtime Rule. Finalized in May, the Overtime Rule doubled the salary threshold for exempt employees from $455 per week ($23,660 annually) to $921 per week ($47,892 annually). Exempt employees receive time-and-a-half pay for any time worked above 40 hours in a given week. The Overtime Rule was set to take effect on December 1, 2016.
In September of 2016, 21 state attorneys general, joined by over 50 business organizations, filed suit challenging the Overtime Rule and requesting preliminary and permanent injunctions. In granting the preliminary injunction, Judge Mazzant stated the DOL “exceeds its delegated authority and ignores Congress’s intent by raising the minimum salary threshold such that it supplants the duties test.” Under the FLSA, an employee is exempt from overtime pay if the earned wages are in excess of the salary threshold and the employee’s duties are administrative, executive or professional. The injunction applies nationwide and prevents the DOL from implementing the Overtime Rule pending further order of the court.