Judge Temporarily Blocks Implementation of DOL Overtime Rule
November 24, 2016 by Frank Klimko
SHERMAN, Texas – A federal judge issued a preliminary injunction blocking implementation of the U.S. Department of Labor’s overtime rule, finding the DOL had overstepped its authority in expanding the pool of employees eligible for overtime pay.
Judge Amos L. Mazzant, of the U.S. District Court for the Eastern District of Texas, put on hold implementation of the rule nationwide. The final rule was to go into effect on Dec. 1.
“With the final rule, the department exceeds its delegated authority and ignores Congress’s intent by raising the minimum salary level such that it supplants the duties test,” Mazzant wrote. “If Congress intended the salary requirement to supplant the duties test, then Congress, and not the department, should make that change.”
Charles Symington, Independent Insurance Agents & Brokers of America senior vice president of external and government affairs, said the IIABA applauded the move. The Big I was the only insurance trade association to participate in the lawsuits over the overtime rule.
“The rule, should it go into effect, will have a significant impact on many Big I agencies and their small business and nonprofit clients,” Symington said in a statement. “As litigation continues, the Big I will continue to use all means necessary to fight this overly burdensome rule.”
Big I joined the U.S. Chamber of Commerce and 12 other national trade associations in filing a lawsuit against the DOL. The attorneys general in 21 states filed a separate lawsuit to halt the rule (Best’s News Service, Sept. 21, 2016).
The rule would expand the pool of employees eligible for overtime by doubling the salary threshold, to $47,476. Anyone under that threshold would be entitled to time-and-a-half pay whenever they work more than 40 hours a week. And, the rule would index the salary threshold to inflation.
A preliminary injunction is not a permanent order and is subject to modification, or it could be vacated entirely, pending further hearings.
In an emailed statement, the DOL said it was reviewing the court order.
“We strongly disagree with the decision by the court, which has the effect of delaying a fair day’s pay for a long day’s work for millions of hardworking Americans,” the statement said. “The department’s overtime rule is the result of a comprehensive, inclusive rulemaking process, and we remain confident in the legality of all aspects of the rule. We are currently considering all of our legal options.”
(By Frank Klimko, Washington correspondent, BestWeek: Frank.Klimko@ambest.com)
