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Business and Policy Areas
Business and Policy Areas
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Federal Judge Strikes Down Overtime Rule

September 1, 2017

Following nine months of uncertainty surrounding the Obama administration’s overtime rule after its original implementation was delayed, the District Court judge who originally delayed it via injunction has issued a final decision invalidating the rule altogether.

The rule as originally crafted by the Department of Labor (DOL) would have increased the salary threshold for employees eligible for overtime pay from $23,660 to $47,476. This, per the court’s final ruling, was its primary flaw. The decision states that DOL overstepped its bounds in crafting a rule based solely on salary levels, and instead should have also focused on job descriptions when determining whether a worker is eligible for overtime pay.

The singularly salary-based overtime threshold, in the court’s opinion, would unintentionally sweep in management-level workers for overtime eligibility when they were really meant to be exempt from overtime protections.

Given the Trump administration’s opposition to the rule, it is unlikely that the federal government will appeal this decision. While DOL had taken steps to explore recrafting the rule while this litigation was pending, including requesting public comment, it is unknown whether or not the department will continue to work on modifying existing overtime rules now that there is no legal requirement to do so.   

Contact

Megan Schneider
Assistant Director, Federal Affairs
202.861.2547
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