Millions of low-paid supervisors would have become eligible for overtime pay next week, but a federal judge in Texas blocked that path late Tuesday afternoon, ruling that Congress intended duties, not wages, to determine eligibility for overtime and minimum wage.
U.S. District Judge Amos L. Mazzant, sitting in Sherman, issued an emergency preliminary injunction to stop new overtime rules adopted by the Obama administration from taking effect on Dec. 1 as scheduled. The new rules would have raised the automatic salary threshold for executive, administrative, and professional positions to be eligible for overtime.
Under current rules, white collar workers earning more than $455 a week ($23,660 annually) are not eligible for overtime. The new rules would double that threshold to $921 per week, ($47,892 annually).
The state of Texas and 20 other states requested the injunction after filing suit to prevent enactment of the higher wage thresholds. The states argued they couldn’t afford to pay overtime to employees who were exempt under existing standards. The injunction appears to apply to all employers, including private employers.
Employment lawyers said that the ruling doesn’t mean that the new rules will get thrown out, but rather stops them from being put into effect while the case is litigated. Stephen Roppolo, a Houston lawyer, said he expects the Labor Department will ask the Fifth Circuit Court of Appeals to step in and overrule the lower court.
“It’s not a done deal,” Roppolo said.
The Labor Department did not immediately respond to a request for comment.
Mazzant noted in his ruling that when Congress enacted the Fair Labor Standards Act in 1938, it did not include a salary threshold. The Labor Department developed a duties test to define which occupations were exempt from overtime. By 1949, the department had incorporated a minimum salary into the formula.
The last time the rules changed was 2004, when white collar workers had to meet three tests to be exempt from overtime: they had to be paid a salary, earn at least $455 per week and perform executive, administrative or professional duties.
The real focus of Congress was on the duties performed, not salary paid, noted Mazzant.
See here for the background, and here for the opinion. You’d think after an election that was supposedly all about economic anxiety and stagnant wages, a judge blocking an effort to increase the pay for millions of people who currently earn modest salaries, due to the relentless efforts of Attorneys General like Ken Paxton, might be a bit of a political issue going forward. Just a thought. The Trib, Kevin Drum, Nancy LeTourneau, and the Current have more.