Issue link: http://psai.uberflip.com/i/757158
New Overtime Rule Will Not Go Into Effect December 1 Early last week, Judge A mos Mazzant of the U.S. District Court for the Eastern District of Texas granted a preliminary injunction blocking the Department of Labor's (DOL's) new federal overtime rule, which would have raised the Fair Labor Standards Act's (FLSA's) salary threshold for exemption from overtime pay from $23,660 to $47,476. As a result of this ruling, unless there is an appeal and immediate ruling, the new salary threshold will NOT go into effect on December 1 (contrary to what was previously reported in various medi a outlets, including Association Insight). So, what does this all mean — both for the regulations in general and your company? Veena Iyer, attorney with the Minneapolis law firm Nilan Johnson Lewis, addresses two critical questions on the minds of employers : What is likely to happen next? The DOL under the current administration will almost certainly appeal this decision to the Fifth Circuit Court of Appeals. The Fifth Circuit could stay the district court's decision while it hears the appeal (essentially a llowing the new rule to go into effect while the court adjudicates the appeal). We think a stay is unlikely, especially because of the difficulties that could arise from forcing employers to comply with the new rule and then invalidating it. Whoever loses at the Fifth Circuit would have the option of seeking review from the U.S. Supreme Court, which is unlikely to hear the appeal until a new administration is in place. Significantly, the DOL does not need to maintain its position from administration to adm inistration (and there are indications that the new administration is opposed to the new rule). In other words, the DOL under a new administration could decide to fight for the new regulations or abandon them. What are your company's options? If your org anization was due to increase the salaries of exempt employees or reclassify them to non - exempt status only because they did not meet the new salary threshold, you no longer are required by law to do so at this time. In the process of coming into complia nce with the new regulations, some portable sanitation companies may have found that certain exempt employees also did not meet the duties tests for the "white collar" exemptions. The Texas court's decision does not affect the duties tests. If an exempt em ployee did not meet the duties test before this decision, s/he does not meet it now and should be reclassified . As is the case with other regulatory issues affecting employment relations, nonprofits with further questions should consult an employment law attorney. The ongoing debate of this issue and the increased competition for highly competent employment candidates underscores the need to correctly categorize and compensate company staff members, regardless of future rulings. The PSAI will continue to monitor developments closely and will keep you apprised of future developments impacting your company as we learn of them. W EEKLY EDITION NOV 30, 2016 P AGE 3