Court Issues Preliminary Injunction Halting Overtime Rule

As reported by the Partnership to Protect Workplace Opportunity (PPWO), of which AMOA is a member, November 23, 2016

  "As you know, the final FLSA overtime rule was set to go into effect next week on December 1, 2016. The new rule would double the salary threshold for employees to qualify as exempt from overtime pay requirements from $23,660 per year to $47,476 per year. It also includes a provision to automatically update this salary threshold every three years beginning in 2020.

  A lawsuit filed by 21 states challenging the new rule was consolidated with another challenge brought by multiple trade associations, including PPWO members, although the PPWO was not directly involved. Yesterday evening, the federal court judge granted a preliminary injunction of the entire rule prior to its December 1 effective date. 

  In issuing the nationwide injunction, the court struck down the excessively high salary-threshold and the automatic updating mechanism under the final rule. The decision is attached. 

  The practical impacts of this ruling are:

  1. Employers do not need to implement changes by the December 1, 2016 deadline, although the court, after hearing the full case, could allow the rule to go forward.
  2. The incoming Trump Administration now has more time to make changes and end the rulemaking permanently or issue a new rule.
  3. Congress could address the final overtime regulations during the lame duck or in the beginning of the 115th Congress.

   The court’s decision is welcome news for employers who have been struggling with the impacts of the rule—both to their budgets as well as its impact on workplace flexibility and employee morale."

To read the Court's full Memorandum Opinion and Order, click here to download.


Update on New Overtime Rule to Go Into Effect December 1, 2016

As reported in Off-the-Top, October 14, 2016
Since originally proposed, DOL's (U.S. Department of Labor) rule has been met with widespread opposition from a broad assortment of businesses and organizations, all of whom have voiced concern about the impact of the measure.

The Partnership to Protect Workplace Opportunity (PPWO) was created to serve as a unified voice in urging the DOL to closely examine the ramifications of the changes and consider less harmful alternatives.

To date, these concerns have been largely ignored by DOL. Two pieces of PPWO-supported legislation have been introduced in Congress to stop or delay the new DOL rule, but AMOA--a member of the PPWO coalition--is recommending its members prepare for the DOL measure to be implemented on Dec. 1, 2016.

Click here for more information on the Overtime Reform and Review Act (SR.3464).
Click here for a summary, section by section, put together for the PPWO coalition members.