Nine days before the December 1, 2016, effective date, a federal district court in Texas has issued a nationwide injunction against implementation of the United States Department of Labor’s new rules which would dramatically increase the salary thresholds for most workers exempt from the overtime pay requirement of the Federal Fair Labor Standards Act. The injunction is a preliminary injunction, meaning that it is not a permanent injunction. The court did state that the Plaintiffs, numerous state attorneys general, are likely to succeed in a final decision, and, therefore, a preliminary injunction preserving the status quo is warranted.
At this time, there is no news on whether the Department of Labor intends to pursue an emergency appeal of the preliminary injunction. It is also unknown whether the new administration’s Labor Department and Justice Department will continue to defend the new regulation after the presidential inauguration.
The preliminary injunction does not forbid employers from adopting the new, higher salary thresholds voluntarily; employers have always been permitted to treat exempt employees as nonexempt for overtime purposes. But for the time being at least, compliance with the new overtime pay thresholds will not be mandatory.