By: Scott J. Connolly and Sandra E. Kahn
On November 22, a federal judge in Texas issued a preliminary order that temporarily blocks the U.S. Department of Labor (DOL) from implementing changes to the salary basis for white collar overtime exemptions. The new salary rule, which was to become effective on December 1, 2016 would have required employers to increase exempt employees’ minimum salary from $23,660 to $47,476. The preliminary court order blocking the rule appears to apply to all public and private employers nationwide.
Find out how the judge’s order will affect the new salary rule, which was to become effective on December 1. Read this month’s Employment Law Alert.
In March 2014, one year ago, President Obama signed a Presidential Memorandum directing the U.S. Secretary of Labor to make changes to the federal overtime regulations concerning the “white collar” exemptions to the overtime requirements. The President directed the Secretary to “restore the common sense principles” to the overtime exemptions.
In May 2014, the U.S. Department of Labor announced a target date of November 2014 for publishing the proposed changes. The Department subsequently engaged in meetings with businesses and employees in which it solicited input and ideas, including on raising the minimum required salary level from its current level of $23,660 and adjusting the primary duties test. The Department did not meet its November 2014 target date and, instead, set a new target date of February 2015. The February date has come and gone without publication of the proposed regulations.
Last week, on March 18, the U.S. Secretary of Labor stated that the Department was “working overtime” on the proposed changes and that he “hoped” they would be published this Spring. Once published, the proposed changes will be subject to public comment and, most likely, substantial modification. Consequently, the final revised regulations will most likely not go into effect until sometime in 2016.
We will keep clients updated on the proposed changes. In the meantime, please feel free to contact the Employment Law team with any questions.