Department of Justice Appeals FLSA Overtime Ruling

Until a decision is made by the appeals court, cities should continue to follow the $455/week “white collar” salary basis test for an FLSA exemption.
(Published Dec 19, 2016)

The U.S. Department of Justice (DOJ) has filed an appeal to the recent federal district court decision that blocked the new Fair Labor Standards Act (FLSA) overtime rule.

As reported previously in the Cities Bulletin, there was a nationwide injunction blocking the U.S. Department of Labor (DOL) from implementing the rule that would have raised the salary threshold for the FLSA “white collar exemption” to $47,476 on Dec. 1. The DOJ, on behalf of the Department of Labor, filed a motion on Dec. 1 for an expedited briefing of its appeal to the preliminary injunction to the 5th U.S. Circuit Court of Appeals.

On Dec. 8, the 5th Circuit granted the motion for expedited briefing, with final briefs due by Jan. 31 and oral argument to be scheduled shortly thereafter. Until further word from the court or the Department of Labor, employers should continue to follow the $455/week “white collar” salary basis test for an FLSA exemption (versus the increased amount of $913/week included in the DOL’s Final Rules that the court blocked). More information on duties and salary tests for FLSA exemptions is available in a League information memo.

Possible scenarios under new president
The League will keep you posted on further developments as they become available. In the meantime, it’s important to understand what could happen under the new president since it appears a decision in the case will not be reached before inauguration day on Jan. 20.

Later in January, the new president and ultimately his labor secretary appointment, will oversee the Department of Labor appeals. While many options regarding the appeal would be available to the new president, some pundits predict possible outcomes, including requesting the court leave the injunction in place pending new rulemaking or withdrawing the DOL’s appeal.

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