FLSA Overtime Rule Temporarily Blocked By Federal Court
In a recent decision by a federal judge in Texas, the DOL’s (Department of Labor) new overtime rule under Fair Labor Standard has been blocked temporarily.
The new changes in the rule were set to come into effect from December 1, 2016. The changes would have raised the minimum salary threshold for exempted employees or reclassified them as non-exempt from overtime pay. The ruling came out in favor of the 21 states that filed the suit against DOL challenging the rule.
With the rule going on hold for uncertain time, how the employers should react to it? How will it affect them?
Here are a few questions that could help employers understand the current situation:
#1 Is it actually blocked or should employers get prepared for Dec. 1?
As of now, the rule is on hold and will not rollout on Dec 1, 2016. Employers can follow the prevailing regulations.
But, don’t assume that the rule is completely barred! It is temporarily taken down and might get implemented with certain modifications in future.
#2 Is the ruling applicable across all states?
Since the rule was to come into effect across all states, thus the restriction will also apply nationwide.
Since, it might give a relief to employers who haven’t yet reclassified their employees as exempt and non-exempt, but for the employers who followed the rule and to abide by it, already raised their employees’ salaries, might get a difficult time taking the decision back.
The ruling has definitely brought some welcoming news for employers, but this should not be considered as the final decision as it is just temporarily put on hold and DOL holds the right to challenge it. Unless the final decision comes out, employers must continue paying employees according to the existing regulations. But, at the same time, they must stay prepared for any new decision on overtime pay.