On August 31, 2017, Judge Amos L. Mazzant III of the U.S. District Court for the Eastern District of Texas issued an order holding that the 2016 Fair Labor Standards Act white-collar overtime exemption regulations were invalid. In November 2016, Judge Mazzant had issued a nationwide preliminary injunction blocking the new FLSA white-collar overtime exemption regulations from taking effect on December 1, 2016. With the order issued on August 31, 2017, Judge Mazzant formally struck down the challenged regulations, granted summary judgment for the plaintiffs, and closed the case.
As you may recall, the 2016 regulations more than doubled the minimum weekly salary requirement for most white-collar overtime exemptions from $455 to $913. The regulations contained a number of additional provisions, the vast majority of which were not viewed favorably by employers.
In his decision, Judge Mazzant clarified that the DOL has the legal authority to create a minimum salary requirement for the white-collar overtime exemptions, but in this case exceeded that authority by more than doubling the existing minimum salary requirement. In a separate decision also issued on August 31, 2017, Judge Mazzant denied a motion to intervene in the case filed by the Texas AFL-CIO, finding that the motion was untimely and that the DOL adequately represented whatever interests the Texas union had.
On the same day that the Court issued its order granting summary judgment and closing the case, the DOL asked the appeals court that was set to hear the appeal of the November 2016 preliminary injunction decision to hold that appeal in abeyance “pending further discussions by the parties in an attempt to narrow the dispute and potentially eliminate the need for this appeal.” It is unclear what the next steps for the parties in this matter will be, but the events of August 31, 2017 decrease significantly the likelihood of the 2016 regulations ever taking effect.
Where are we now and where to we go from here?
A future decision by an appeals court overturning Judge Mazzant’s decision appears unlikely, primarily because the Trump Administration’s DOL likely will not pursue such an appeal and Judge Mazzant denied the Texas AFL-CIO’s motion to intervene in the case. Thus, the requirements for the white-collar overtime exemptions remain (and should remain for the near future) what they were before the 2016 regulations, with a minimum weekly salary requirement of $455.
The Trump DOL has indicated that it intends to issue new regulations that would revisit, and likely increase, the white-collar exemptions’ minimum salary requirement. Unless and until those regulations are issued and take effect, $455 remains the minimum weekly salary requirement, and the existing regulations, which date back to 2004, remain in effect.