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Federal Judge Blocks Overtime Rule

Published on by Dave Phelps in Tax Services

Federal Judge Blocks Overtime Rule

On November 22, 2016, U.S. District Judge Amos L. Mazzant III granted a preliminary injunction to stop the mandatory overtime pay rule that was due to be implemented on December 1, 2016.

A lawsuit was filed by 21 states and a coalition of businesses in September to block the Department of Labor from enforcing the rule. There is no word on when or if the overtime pay rule may become effective.

According to the Department of Labor, the final rule, if enacted, would:

  • Increase the salary threshold indicating eligibility from $455/week to $913 ($47,476 from $23,660 per year.)
  • Automatically update the salary threshold every three years, based on wage growth over time.
  • Fortify overtime protections for salaried workers that are already entitled to overtime.

While the injunction is not permanent, the language used by the judge has opponents of the rule confident that it will be struck down in a final ruling.

The Barnes Dennig tax team will keep you posted as further developments arise. Please feel free to contact a member of our team here in order to discuss the potential implications of this ruling, and how you can best plan for your workforce.


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