What’s Next for DOL Rule?

A controversial rule that would have more than doubled the salary threshold for overtime pay was dealt its final blow in recent weeks.

The rule, issued by the Department of Labor under the Obama administration, intended to reduce the number of employees exempt from overtime pay.

Specifically, the DOL sought to raise the salary threshold from under $24,000 a year to $47,476 a year. This meant an employee earning a regular salary of less than $47,476 could be eligible to receive overtime pay.

A federal judge in Texas entered a nationwide injunction last year blocking the DOL from implementing the rule. The DOL, still under the Obama administration, appealed the injunction to the Fifth Circuit.

On August 31, the Texas court again struck down the rule, this time on the merits rather than temporarily. And on September 6, the Fifth Circuit accepted the Trump administration’s request to withdraw the DOL’s appeal.

This means the August 31 decision should be the final blow for the rule. It does not, however, signal the end to the story.

The Trump administration began reevaluating the DOL rule long before the recent Texas decision. It’s possible that this administration will decide to increase the salary threshold for overtime but land on a lower number.

In the next issue of Ag Innovator magazine, labor attorneys Joe Schmitt and David James discuss what’s likely to happen next.