As I sat down to write today’s column and was getting ready to tell you that despite the rumors the new overtime law was still taking effect, news broke that a judge in Texas had in fact blocked said rule, which was supposed to take effect December 1st.
Everyone was aware that there were over 20 lawsuits brought by states and other business organizations, that challenged the Dept of Labor’s authority to raise the salary threshold from $23,660 to $47,476.
But many experts were predicting that nothing much would come of it, and that the new administration would try to modify the rule next year by for example carving out a small business exemption and doing away with the automatic every-third-year increase.
This was all generally accepted.
That’s why this judge’s decision to block it was frankly unexpected. After all, the rule took years to write and underwent a long process of public input and review. The injunction affects not just Texas, but the whole country and places all American businesses and employees in a holding pattern.
So, does this mean I don’t have to do anything by Dec 1st?
That’s right. For now, the NEW overtime rule will NOT take effect, the old rules still apply.
Is this decision final, is this the end to the rule?
No. The rule could still take effect at a later time. An injunction is a temporary hold until the courts can decide the merit of the challenge.
So can the DOL challenge the injunction?
Yes. They are looking at their legal options and stated the “overtime rule is the result of a comprehensive, inclusive rulemaking process, and we remain confident in the legality of all aspects of the rule”.
What if you had already announced changes to employee’s salaries or exemption status?
That’s a tough one. You must decide what’s best for your business and employees. When possible leave decisions you’ve already made in place. If you must reverse the changes, be consistent. Be mindful of employee’s perception in all of this. If you haven’t made changes, you can hold off for now.
But going forward, don’t assume that the rule is dead. Keep your plans and be prepared for the unexpected. Stay tuned.
©Copyright Eva Del Rio
Eva Del Rio is creator of HR Box™ – tools for small businesses and startups. Send questions to Eva@evadelrio.com
