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Judge stops the clock on overtime pay regulation

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Judge stops the clock on overtime pay regulation

In a sweeping ruling, the U.S. District Court in Sherman, Texas, has issued a preliminary national injunction halting the Dec. 1 implementation of Fair Labor Standards Act wage-and-hour regulations that double the salary threshold at which white-collar workers are entitled to overtime pay.

While experts had said Judge Amos Mazzant III might issue a preliminary injunction to halt a mechanism to automatically update the standard salary level requirement every three years, he was not widely expected to issue one impacting the entire regulation.

Two lawsuits objecting to the regulations were consolidated in October. They were filed by the Washington-based U.S. Chamber of Commerce on behalf of more than 50 other groups and by Nevada Attorney General Adam Paul Laxalt on behalf of a coalition of 21 states.

The new threshold under the regulation is $913 a week or $47,476 annually for a full-time employee, compared with the current $455 a week or $23,660 annually.

In his ruling Tuesday, Judge Mazzant states it is clear that “Congress intended the (executive administrative professional) exemption to apply to employees doing actual executive, administrative and professional duties.

“In other words, Congress defined the EAP exemption with regard to duties, which does not include a minimum salary level.” The final rule “is directly in conflict with Congress’ intent,” said the ruling.

“The court finds the public interest is best served by an injunction,” said the ruling. “If the Department (of Labor) lacks the authority to promulgate the Final Rule, then the Final Rule will be rendered invalid and the public will not be harmed by its enforcement.

“However if the Final Rule is valid, then an injunction will only delay the regulation’s implementation. Due to the approaching effective date of the Final Rule, the Court’s ability to render a meaningful decision on the merits is in jeopardy. 

“A preliminary injunction preserves the status quo while the Court determines the Department’s authority to make the Final Rule as well as the Final Rule’s validity,” said Judge Mazzant.

 

 

 

 

 

 

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