A federal judge has blocked -- for now -- changes in the Fair Labor Standards Act affecting overtime pay. Our legal pals at Ice Miller tell us:
In a stunning turn of events, a Texas federal district court has entered a preliminary nationwide injunction against the U.S. Department of Labor's (DOL) updated "white collar" overtime regulations. ... Subject to rapid intervention by the Fifth Circuit Court of Appeals, the new rules, including the increased minimum salary requirement, will not go into effect on December 1.
It is important to note that the district court has issued only a preliminary injunction. It is possible (although seemingly unlikely) that Judge [Amos L.] Mazzant could change his reasoning when he ultimately decides whether or not to issue a permanent injunction. Additionally, the decision could be stayed pending appeal (i.e., temporarily suspended) or overturned entirely by the Fifth Circuit. The forthcoming change in presidential administrations only adds to the uncertainty.
Find the full alert here.
CEDIA® had provided complete details on the changes complete with a comprehensive webinar and accompanying PowerPoint presented by Ice Miller which you can find here.
Something to note: if you had been already working out a plan with your employees regarding a bump in pay or some other machination that would mean fewer hours on the clock, you may want to consider morale issues that would arise if more cash and/or time off that had been promised is suddenly taken away. (Here’s a link to today’s Marketplace Morning Report complete with that red flag.)
CEDIA has reached out to experts on the subject, and we’ll keep you posted as info comes in. But for now, it's probably wise to heed Ice Miller's advice:
Given the lack of clarity as to the rule's short and long term fate, employers should proceed cautiously and consult with counsel prior to scrapping compliance plans or making any major compensation changes.