A Texas Federal Judge issued a nationwide injunction temporarily blocking the Department of Labor from enforcing the new minimum salary that must be paid for an employee to be exempt from the overtime pay requirements. The rule which was to take effect on December 1, 2016, would have increased the salary minimum to $47,476.00 annually ($913 per week). TEXAS FEDERAL JUDGE BLOCKS IMPLEMENTATION OF THE SALARY REQUIREMENT FOR OVERTIME EXEMPTIONS will have lasting implications.
The rule will not take effect on December 1, 2016 in light of this injunction. The future of this rule is not clear at this point in time as the judge’s injunction is temporary. As of now, employers do not have to implement this salary increase.
In an article “Texas federal judge blocks DOL overtime rule” By Lisa Milam-Perez, J.D., she says that: In a crucial blow to the Obama administration’s labor and employment legacy, a federal district court in Texas has granted an emergency motion for a preliminary injunction barring the Department of Labor from enforcing its revised overtime rule, scheduled to take effect December 1, pending resolution of a consolidated legal challenge (State of Nevada v. U.S. Department of Labor, November 22, 2016, Mazzant, A.).
The final rule was poised to double the salary level required for employees to be deemed exempt from overtime under the FLSA pursuant to the DOL’s executive, administrative, and professional (“white collar”) exemption. However, a coalition of more than 50 business groups and a separate combined effort by 21 states sued to invalidate the regulation, seeking expedited consideration and emergency injunctive relief. The court, ruling on the state plaintiffs’ injunction request, found they demonstrated a substantial likelihood of success on the merits, as well as the prospect of irreparable harm. A nationwide preliminary injunction preserved the status quo while the court ponders whether the DOL had authority to promulgate the final rule and whether the rule itself was legally viable.
Salary—or duties? The rule’s new salary level of $47,476 (up from the current floor of $23,660) was based upon the 40th percentile of weekly earnings of full-time salaried workers in the lowest wage region of the country (currently the South), and it would have rendered 4.2 million formerly exempt workers now overtime-eligible—with no evident change in the duties they perform. In promulgating the latest iteration of the regulation, the DOL was quite deliberate in not tinkering with the vexing “duties” provisions. The thinking was, if the salary level were set sufficiently high, more employees would be exempt, without first having to scrutinize whether they performed duties that were executive, administrative, or professional in nature. Ultimately, though, that may well prove the DOL’s downfall, as the plaintiffs argued convincingly that Congress intended to exempt employees based on the duties they perform—not the salary they earn.
Automatic update. The DOL added a new provision to its white-collar rule: an automatic updating mechanism, which would adjust the salary floor every three years. The court brushed off the DOL’s contention that any challenge to this provision was not yet ripe for review. Nonetheless, since it found the final rule was likely unlawful already, the court said it didn’t need to tackle the legality of this particular provision. [http://www.employmentlawdaily.com/index.php/news/texas-federal-judge-blocks-dol-overtime-rule/]
Franklin, Gringer & Cohen, P.C. has a longstanding history of specializing in Labor & Employment Law:
How Our Firm Can Help You?
Virtually any employee who is terminated can claim discrimination based on age, sex, race, national origin, disability, religion or veteran status. Since the enactment of the 1991 Civil Rights Act, which provided for jury trials and compensatory and punitive damages, employment discrimination litigation has skyrocketed. Also, employees are more aware of their legal options as they read in the newspapers about jury verdicts that are frequently in seven figures. We counsel our clients on avoiding such cases through proper handling of disciplinary issues and reductions in force, and the development and communication of sound corporate policies.
What makes our law firm different from other law firms?
We have over sixty years of combined experience representing employers in labor relations and employment law matters. We believe that there are numerous advantages for a company to look to a firm that has practiced labor and employment law for many years in both preventing and defending employment discrimination litigation. Our foremost concern is to avoid litigation whenever possible through preventive planning. Our clients consult with us on a regular basis before taking action to avoid labor disputes and costly lawsuits. The best result for a client is the lawsuit that does not happen in the first place.
We have been giving seminars and writing articles for many years on how to avoid litigation through the use of progressive discipline, documentation, consistent treatment, adoption of anti-harassment policies, employee handbooks, and proper training of supervisory staff. We give this advice because we have seen that it has worked for our clients. Our long-term clients who regularly consult with us before taking adverse disciplinary action rarely face litigation over those decisions. Unfortunately, many clients do not come to us until after they have been sued. However, our expertise and experience also benefit these clients. They do not have to pay for an inexperienced attorney’s “learning curve”. Instead, they can take advantage of our combined experience of over sixty years in handling thousands of termination cases so that the merits of each case and possible exposure can be properly assessed.
What are some of the specific areas covered by our firm’s labor and employment law practice?
>Litigation of Employment Discrimination Cases in Federal and State Courts and in Administrative Agencies
>Development of Anti-Discrimination and Harassment Procedures and Policies
>Training Seminars for Supervisors
>Investigation of Sexual Harassment Cases
>National Labor Relations Board Proceedings
>Collective Bargaining Negotiations
>Union Grievances and Arbitrations
>Union Organizing Campaigns
>Wage and Hour Investigations and Litigation
>Occupational Safety & Health Act (OSHA)
>Development of Affirmative Action Plans
>Immigration Reform and Control Act of 1986
>Worker Adjustment and Retraining Notification Act of 1986 [Plant Closing Law]
>ERISA and Employee Benefits
>Negligent Hiring Cases
>Employee Defamation Suits
>Restrictive Covenants and Trade Secrets Employment Contracts
>Employee Surveillance and Privacy Issues
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