Finally, it appears we have closure on this saga that started over a year ago! On August 31st, the same Texas federal district court judge who granted a preliminary injunction last November delaying the effective date of the Department of Labor’s new overtime rule, issued a final judgment invalidating the rule. As you may recall, the Obama-era overtime rule attempted to:
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double the minimum salary required for exemption from overtime of executive, administrative, and professional employees from $455 to $913 per week.
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establish a mechanism to automatically update the salary and compensation levels every three years.
In his decision, the district court judge concluded that:
Congress unambiguously directed the [DOL] to exempt from overtime pay employees who perform bona fide executive, administrative, or professional capacity duties. However [the new DOL rule] makes overtime status depend predominately on a minimum salary level, thereby supplanting an analysis of an employer’s job duties. . . . Because the [rule] would exclude many employees who perform exempt duties, the [DOL] fails to carry out Congress’s unambiguous intent.
For similar reasons, the judge struck down the automatic salary updates as well.
What Wisconsin employers need to know: Whether the DOL under the current administration will propose any overtime rules remains to be seen, but we do not anticipate any major changes in the foreseeable future.
