Texas Court Overturns Obama’s Overtime Rule

Oct 11, 2017

The 2014 DOL rules remain in place

One of President Obama’s last acts while in office was to instruct the Department of Labor to revise the Fair Labor Standards Act’s “executive, administrative, and professional (‘EAP’) exemptions.” As an article in the SEYFARTH SHAW blog by Brett C. Bartlett, Alexander J. Passantino and Kevin M. Young notes, the revision would have increased the maximum salary for coverage under the Act from “$455.00 per week…to $913 per week…”

The revision was not implemented on December 1 of last year, as scheduled, because two law suits challenging the new standards were filed in the Eastern District of Texas. Pending his decision on the lawsuits, “District Judge Amos Mazzant issued an order days prior [to its effective date] that enjoined it from going into effect.”

One of the suits was filed by attorneys general for several states; the other was brought by business associations.

Both plaintiffs argued that the DOL exceed its Congressional mandate when it unilaterally revised the 2014 rule.

The legal controversy became political when Mr. Trump became President. The new administration’s Secretary of Labor, Alexander Acosta, “was required to assess how to maneuver a proceeding involving an injunction order that on the one hand blocked the implementation of an overtime rule championed by the prior administration, but on the other hand suggested that the DOL might not have the authority to set any salary level for EAP exemptions, despite having done so for nearly eighty years.”

The issue became even more complicated after the AFL-CIO filed a motion to intervene in the suits in support of the Obama’s Administration’s ruling.

Judge Mazzant issued an order on September 28, 2017 that

  1. Denied the AFL-CIO request to intervene;

  2. Consolidated the lawsuits by state attorney’s general and business associations, and

  3. Found the DOL revised order invalid.


According to the authors, the winners in this case are employers who now know what rules they must comply with.

Source—

Obama Overtime Rule Invalidated by Federal Court in Texas, Brett C. Bartlett, Alexander J. Passantino, Kevin M. Young, SEYFARTH SHAW blog, Oct. 1, 2017.