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Preliminary Injunction Blocks Implementation of DOL’s Overtime Rule

    November 23, 2016

    On November 22, 2016, Federal U.S. District Court Judge Amos Mazzant granted a preliminary injunction blocking the Department of Labor’s overtime rule, which would have increased the minimum salary level for exempt employees under the Executive, Administrative, and Professional exemptions from $455 per week ($23,330 annually) to $921 per week ($47,476 annually).  Nevada v. DOL (E.D. Tx. 2016).  Judge Mazzant held that the Department of Labor (“DOL”) exceeded its authority by raising the salary level such that it displaces the Duties Test of the Fair Labor Standards Act.  The Court also concluded that the DOL lacked the authority to implement an automatic updating mechanism that would have adjusted the minimum salary level every three years. 

    The Final Rule was scheduled to become effective December 1, 2016. While the overtime rule could still be implemented at a later time, the granting of the preliminary junction preserves the status quo until the Court determines the DOL’s authority and the Final Rule’s validity.  For now, employers can postpone plans to implement changes required by the law.  

    NCHRA will keep you posted on any new developments.