Reprinted from USA Today by Paul Davidson on August 31, 2017.
A federal judge Thursday struck down an Obama-era rule making millions more Americans eligible for overtime pay, saying the Labor Department set an excessively high salary threshold to determine which employees are exempt from overtime.
US District Judge Amos Mazzant’s ruling affects an estimated 4.2 million workers who would have been eligible for time-and-a-half wages for each hour they put in beyond 40 a week. The decision was widely anticipated after Mazzant granted a preliminary injunction in November that prevented the overtime rule from taking effect as scheduled on December 1 while he weighed a final ruling.
“The regulation is dead,”said Alexander Passantino, co-chair of the wage-and-hour litigation practice at Seyfarth Shaw and former head of Labor’s wage and hour division during the Bush administration.
Many businesses said the rule would have sharply increased labor costs and hurt morale by forcing employers to demote managers to hourly employees.
The rule, released by the Obama administration in May 2016, would have nearly doubled the threshold at which executive, administrative and professional employees are exempt from overtime to $47,476 from $23,660. …
Overtime Rule Struck Down by District Court Judge
Reprinted from High Tech Facts by Doris Roberson on September 1, 2017.
Under the terms of the proposed rule, salaried employees earning up to $47,476 a year, or $913 a week, would have been automatically eligible to receive time-and-a-half pay when they worked more than 40 hours a week, regardless of whether they performed executive, administrative, or professional duties.
[East Texas District Judge Amos] Mazzant’s ruling isn’t much of a surprise given his previous rebuke of the rule when grating a November 2016 emergency injunction that halted the intended December 1 effective date on a nationwide basis. (Slip Op.at 14.) “Nor does the Department have the authority to categorically exclude those who perform “bona fide executive, administrative, or professional capacity” duties based on salary level alone”. The Plano Chamber of Commerce and more than 55 other business groups had filed a lawsuit challenging the rule, which was consolidated with a similar challenge brought by the State of Nevada and 20 other states.
“I applaud Judge Mazzant’s decision to permanently invalidate this Obama-era overtime rule that would have would have imposed millions of dollars of unfunded liabilities on the states and resulted in a loss of private sector jobs as well as onerous financial and regulatory burdens on small businesses in Nevada and around the country,” [Nevada Attorney General Adam] Laxalt said. The Labor Department past year had appealed Mazzant’s decision temporarily blocking the Obama administration rule, weeks before President Donald Trump took office. The court also denied a request filed by the Texas AFL-CIO to take over the defense of the rule. …