The DOL will appeal a Texas federal court’s ruling that the Obama administration’s 2016 overtime rule exceeded the DOL’s authority. The appeal comes nearly two months after the DOL dropped an earlier appeal of that court’s preliminary injunction on the same topic.

The 2016 overtime rule would have required employers to pay most executive, administrative, and professional employees at least $913 per week in order to exempt them from the overtime pay requirements—more than doubling the current weekly salary threshold of $455.  Judge Amos Mazzant’s preliminary injunction in November 2016 invalidated the new overtime rule on a nationwide basis, concluding that the DOL exceeded its authority by increasing the salary threshold so dramatically so as to effectively eliminate the “duties test” for exemption required by the Fair Labor Standards Act (FLSA).

In August 2017, Judge Mazzant granted summary judgment to the plaintiffs in the overtime rule challenge, permanently invalidating the 2016 rule.  Judge Mazzant concluded that the $913 threshold “would essentially make an employee’s duties, functions, or tasks irrelevant” and that the overtime status of “entire categories of previously exempt employees” would “depend predominately on a minimum salary level.”  Judge Mazzant also concluded that the DOL exceeded its statutory authority by including a provision in the 2016 overtime rule that would have automatically updated the salary level every three years.  The DOL’s latest appeal targets this summary judgment order.

The DOL was quick to clarify to the Wall Street Journal that its latest appeal is not an endorsement of the salary level in the 2016 overtime rule, but is only intended “to maintain Secretary Alexander Acosta’s ability to establish overtime regulations.”  Earlier this year, the DOL sought public comment on a revised overtime rule.  Secretary Acosta’s statements in June 2017 indicated that the DOL may be considering a salary level of about $635 per week.

UPDATE (November 7, 2017): At the DOL’s request, which the plaintiffs did not oppose, the Fifth Circuit Court of Appeals will hold the DOL’s appeal in abeyance pending the outcome of the DOL’s revised overtime rule.

 

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Photo of Allan Bloom Allan Bloom

Allan S. Bloom is a nationally recognized trial lawyer and advisor who represents management in a broad range of employment and labor law matters. As a litigator, Allan has successfully defended a number of the world’s leading companies against claims for unpaid wages…

Allan S. Bloom is a nationally recognized trial lawyer and advisor who represents management in a broad range of employment and labor law matters. As a litigator, Allan has successfully defended a number of the world’s leading companies against claims for unpaid wages, employment discrimination, breach of contract and wrongful discharge, both at the trial and appellate court levels as well as in arbitration. He has secured complete defense verdicts for clients in front of juries, as well as injunctions to protect clients’ confidential information and assets.

As the leader of Proskauer’s Wage and Hour Practice Group, Allan has been a strategic partner to a number of Fortune 500 companies to help them avoid, minimize and manage exposure to wage and hour-related risk. Allan’s views on wage and hour issues have been featured in The New York TimesReutersBloomberg and Fortune, among other leading publications. His class-action defense work for clients has saved hundreds of millions of dollars in potential damages.

Allan is regularly called on to advise boards of directors and senior leadership on highly sensitive matters such as executive transitions, internal investigations and strategic workforce planning. He also has particular expertise in the financial services industry, where he has litigated and arbitrated cases, including at FINRA and its predecessors, for more than 20 years.
A prolific author and speaker, Allan was the Editor of the New York State Bar Association’s Labor and Employment Law Journal from 2012 to 2017. He has served as an author, editor and contributor to a number of leading treatises in the field of employment law, including ADR in Employment Law (ABA/Bloomberg BNA, Senior Editor), Employment Discrimination Law (ABA/Bloomberg BNA, Final Proof Editor), Cutting Edge Advances in Resolving Workplace Disputes (Cornell University/CPR, Editor), The Employment Law Review (Law Business Research, U.S. Chapter Author), and The Complete Compliance and Ethics Manual (SCCE, Chapter Author).

Allan is a member of the NYSBA’s House of Delegates, sits on the Executive Committee of the NYSBA’s Labor and Employment Law Section, and is a Fellow of the College of Labor and Employment Lawyers. He has been recognized as a leading practitioner by Chambers since 2011.