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Category: Overtime

Federal Judge Blocks New Overtime Rule

By 23/11/2016 Posted in FLSA, Overtime, Overtime Law, Overtime and Unpaid Wages

In a major (and surprise) ruling, a federal judge in Texas has issued a preliminary injunction blocking the Department of Labor’s new overtime rule scheduled to go into effect on December 1, 2016. The new rule would have increased the minimum annual salary requirements for exempt employees will from $455 per week to $913 per week (or from $23,666-$47,476 per year).  Importantly, although 21 states participated in the lawsuit, US District Judge Amos L. Mazzant rejected a request by the Department of Labor to limit the injunction to the states that filed the lawsuit and instead issued an order blocking the new rule nationwide. WHAT DOES THIS MEAN FOR EMPLOYERS AND WORKERS? For now, employers who rely upon the “white collar exemptions,” referred to as the executive, administrative, and professional exemptions, will be permitted to continue paying the minimum salary requirement of $455 per week.  In order to classify an employee as salaried “exempt,” the employer must satisfy both the salary requirements and the “duties” requirements of the exemptions.  Most overtime claims and overtime liability arise out of an employer’s failure to satisfy the duties requirements for the exemption. For example, the “executive” exemption Employers rely on (sometimes referred to as the “managerial” exemption) requires the employer to demonstrate that the employee’s “primary duty” must be the management of a department or division of the company AND that the employee regularly directs the work of two or more full-time employees (or full-time equivalents) AND that the employee must have the authority […]

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