“Keep Calm and Gobble On” was the mantra for many of us after the Nov 22 decision by Judge Amos Mazzant, U.S. District Court for the Eastern District of
Texas, to halt a Department of Labor rule that would have made millions more Americans eligible for overtime pay.
The change to the FLSA overtime rules was set to take effect on December 1, but it is now on hold. The judge granted a preliminary injunction to the Department of Labor’s authority to raise the salary threshold for exemption from overtime pay from $23,660 to $47,476.
So now what?
- At this time, employers are not required to implement changes by the December 1, 2016 deadline. This doesn’t mean the rule will go away. Remember, this is a temporary injunction until the court has a chance to review the merits of the case objecting to the revisions to the regulation. This could be a short-term reprieve, much like my decision to not eat the entire pumpkin pie. After a full hearing, the rule could stand, it could be rejected or it could be revised. If you haven’t already made changes based on the $47,476 number, now is the time to hold off.
- If you have already made changes to employees’ status and wages, consider leaving your decisions in place. Yes, I know. Urgh. We get that this is a frustrating time for many employers and we empathize with you. Each company and culture is different, so consider how you’ll need to reframe messaging to employees if you decide to reverse your decision. For what it’s worth, in assisting clients with implementing the rule, we found that many were already out of compliance. Before the new rule, the salary test was/is not the sole determinate of exemption status; positions must also meet at least one other exemption including professional, executive, administrative and outside sales. So, even if the rule is revoked or revised, you may be better off having gone through the exercise.
- We are here to help. Wherever you are in this confusing time, we are here to answer questions, discuss the latest information and provide guidance. So keep calm.
Valentine HR provides customized HR support designed to help you meet your business goals. Have questions or need help? Contact me at Caroline@valentinehr.com or call (512) 420-8267.