DOL Overtime Rule Faces Uncertain Future

On November 22, 2016, a federal judge granted a nationwide preliminary injunction blocking the U.S. Department of Labor’s (DOL’s) overtime rule—which more than doubles the required salary level to qualify for the Fair Labor Standards Act (FLSA) "white collar" exemptions—from taking effect on December 1, 2016. Nevada et al. v. U.S. Department of Labor et al., No. 4:16-CV-00731. The new rule would raise the federal exemption threshold from the current $455 per week (note: the current threshold in New York State* ranges from $727.50 to $825 per week) for a full-time employee to $913 per week, or $47,476 per year. The DOL estimated that this would extend overtime pay to roughly 4.2 million people nationwide. The rule’s last minute injunction came just 10 days before its scheduled implementation date and less than two months before the new administration took office. An appeal is still pending in the Fifth Circuit, but as new Trump nominee for Secretary of Labor, Alexander Acosta, is awaiting confirmation by the Senate, it remains unknown whether the DOL—under new leadership—will continue to pursue the appeal.

If you have any questions about overtime pay in general or how this ruling affects your business, please feel free to contact us at 631-423-3440 or visit alilawgroup.com.

*Effective December 31, 2016, the new salary thresholds in New York are as follows:

Large employers in New York City (11 or more employees)
  • $825.00 per week on and after 12/31/16
  • $975.00 per week on and after 12/31/17
  • $1,125.00 per week on and after 12/31/18

Small employers in New York City (10 or fewer employees)
  • $787.50 per week on and after 12/31/16
  • $900.00 per week on and after 12/31/17
  • $1,012.50 per week on and after 12/31/18
  • $1,125.00 per week on and after 12/31/19

Employers in Nassau, Suffolk, and Westchester Counties
  • $750.00 per week on and after 12/31/16
  • $825.00 per week on and after 12/31/17
  • $900.00 per week on and after 12/31/18
  • $975.00 per week on and after 12/31/19
  • $1,050.00 per week on and after 12/31/20
  • $1,125.00 per week on and after 12/31/21

Employers Outside of NYC, Nassau, Suffolk, and Westchester Counties
  • $727.50 per week on and after 12/31/16
  • $780.00 per week on and after 12/31/17
  • $832.00 per week on and after 12/31/18
  • $885.00 per week on and after 12/31/19
  • $937.50 per week on and after 12/31/20