New overtime law update: delayed for now

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overtime rule, government, accountingA Texas U.S. District Judge has filed an injunction, blocking implementation of the Department of Labor’s (DOL) new overtime law. Previously we had discussed the updated overtime law, which the DOL had set to begin December 1, 2016. This law would have doubled the maximum salary an employee earned before becoming exempt from mandatory overtime pay. In the past, employees making up to $23,660 had the option of overtime pay. The update to the overtime pay rule would have increased the threshold for exempt salaries from the current threshold of $23,660 to $47,476, meaning employees making up to $47,476 would now have the option of overtime pay as well.

For now, the fate of this update to the overtime exemption rule is in question. The current administration and the DOL have certain options. They can appeal the decision to 5th U.S. Circuit Court of Appeals in New Orleans, Louisiana and try to get it through before the new administration enters office on January 20th. Alternatively, the DOL could drop the appeal once the new administration enters, as the new President-elect has already openly stated opposition to the updated rule. Due to the uncertainty of the potential changes, employers should make certain to stay up-to-date on this issue.

Steven May