Last week, a federal judge in Texas denied the U.S. Department of Labor’s (DOL) request to stay a lawsuit challenging implementation of the DOL’s new overtime rules during the pendency of the DOL’s appeal to the Fifth Circuit Court of Appeals.
Back in September 2016, twenty-one states sued the DOL and certain administrators over its new overtime rules that, among other things, significantly increased the pool of employees eligible to collect overtime pay. Specifically, the DOL’s new rules required any overtime exempt employee to be paid at least $913 weekly—a figure more than twice the former threshold amount of $455 per week, and raised the base salary to qualify as a “highly compensated employee” to $134,004 annually (an increase from the previous $100,000 threshold). The new rules were scheduled to take effect on December 1, 2016, however on November 22, 2016, Judge Mazzant issued a nationwide injunction that blocked the DOL from enforcing and implementing the new rules.
In response to the nationwide injunction, the DOL filed a notice of appeal to the Fifth Circuit Court of Appeals on December 1, 2016. While the injunction is in place and the DOL’s appeal is pending on an expedited schedule, a motion for summary judgment is pending concurrently before Judge Mazzant in the District Court. The motion for summary judgment, filed by a coalition of more than 55 businesses along with the National Federation of Independent Business and U.S. Chamber of Commerce, seeks to invalidate the DOL’s new rules.
In the latest development, Judge Mazzant declined the DOL’s invitation to stay the District Court proceedings pending a determination by the Appellate Court. This preserves Plaintiffs’ hope that Judge Mazzant might rule on the pending motion for summary judgment before the Fifth Circuit decides the DOL’s appeal.
Judge Mazzant based his decision to deny the DOL’s requested stay, at least in part, on a determination that the mere possibility of the Fifth Circuit’s decision impacting District Court case is, without more, not enough to demonstrate that Defendants are likely to succeed in establishing that the injunction was improperly issued.
The case is State of Nevada et al. v. U.S. Department of Labor et al., No. 4:16-CV-00731, in the U.S. District Court for the Eastern District of Texas. The DOL’s appeal is State of Nevada et al v. LABR et al., No. 16-41606, before the U.S. Court of Appeals for the Fifth Circuit.
