On November 22, 2016, a federal judge issued a nationwide injunction blocking the implementation of the new overtime rule which was scheduled to take effect on December 1, 2016. This means that the injunction will halt enforcement of the rule until the government is successful in winning an order from an appeals court lifting the injunction. The Fifth Circuit Court of Appeals has jurisdiction over the immediate appeal of this decision.
In his decision, U.S. District Judge Amos L. Mazzant ruled that the states and businesses that sued the government to stop the implementation of the rule have a significant chance of success because the drastic increase in salary effectively eliminates the exemptions provided for in the statute by replacing them with a salary test that supplants the duties test.
This means that employers will not be required to comply with the new rules as of December 1, 2016 and can continue to designate employees making $455 a week who meet the duties requirements of one of the exemptions as exempt for the time being.
If you have any questions do not hesitate to contact me.
Sarah Newell
Shareholder – Labor & Employment
Phone: 207-992-4838
Fax: 207-942-3040
Email: snewell@eatonpeabody.com