By Kate McGovern Tornone, Editor
Twenty-one states and several employer interest groups filed lawsuits against the U.S. Department of Labor (DOL) September 20, alleging that the agency’s new overtime regulations exceed its authority. The suits, however, are not expected to have any success in the near future and employers would be well-served to be in compliance by the December 1 deadline, according to one expert.
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Background
DOL issued new regulations earlier this year more than doubling the salary threshold for employees eligible for overtime. Come December, employees earning less than $913 per week (which amounts to $47,476 annually) must be classified as nonexempt from the Fair Labor Standards Act’s (FLSA) overtime requirements, regardless of whether they meet any of the law’s duties tests.
The lawsuits (States of Nevada, et al. v. U.S. Department of Labor, No. 1:16-cv-00407 (E.D. Texas) and Plano Chamber of Commerce v. Thomas E. Perez, No. 4:16-cv-00732 (E.D. Texas)) allege that DOL went too far in several respects.
First, the complaints allege that DOL’s use of the salary threshold as the main test for overtime eligibility ignores the importance that the FLSA places on an employee’s duties. The emphasis on salary “defies the statutory text … Congressional intent, and common sense,” the states’ complaint says.
Moreover, the rule’s automatic increase—which brings the threshold to $51,000 by 2020—runs afoul of federal law requiring that regulations go through notice and comment procedures, the lawsuits claim.