Texas Judge Halts Implementation of New Overtime Regulations – What’s an employer to do?

For Immediate Release

November 23, 2016

Yesterday a federal district court judge in Texas issued an injunction temporarily halting the implementation of the Department of Labor's new overtime regulations which were scheduled to take effect on December 1.  Employers are asking, what do we do now?

So long as the injunction is in place, employers do not have to comply with the new salary threshold requirement.  However, please bear in mind that this injunction is temporary.  Upon judicial review, the injunction may be made permanent, thereby vacating the regulations.  Or the injunction may be lifted allowing the regulations to take effect.  If the injunction is lifted, we don’t know if the regulations will become effective retroactively to December 1.  If the regulations are effective retroactively, an employer may need to demonstrate that it was in compliance effective on December 1. 

At present we do not know how the judge will rule or if the issue will be appealed to a higher court.  While a majority of employers have already implemented changes in this final week, some employers are waiting.  Employers should decide whether or not to implement the overtime regulations based on their business needs and with the understanding of the legal uncertainty this injunction brings.  In our view, the cautious approach would be for employers to maintain accurate records starting on December 1 as if the regulations were in effect.

We will continue to monitor this issue and remain available to answer any questions or concerns you may have. 

Cheryl Brown is an attorney with the Business and Transactional practice group at Davis, Agnor, Rapaport & Skalny, LLC.  For questions about this article or your own labor and employment law matters, please do not hesitate to contact Cheryl.  
 
THE INFORMATION PROVIDED IN THIS DOCUMENT IS GENERAL AND IS NOT INTENDED TO PROVIDE YOU WITH ANY LEGAL ADVICE.  YOU SHOULD CONSULT WITH AN ATTORNEY TO RECEIVE LEGAL ADVICE ON THESE MATTERS.