Federal Judge Strikes Down New Overtime Rule

On August 31, 2017, a federal district court in Texas struck down the U.S. Department of Labor’s (USDOL) overtime rule that was set to go into effect on December 1, 2016.

The overtime rule would have raised the minimum salary threshold required for employees to qualify for the “white collar” exemptions. It also would have raised the minimum salary threshold to $47,476 a year, up from the current threshold of $23,660 a year.

With the injunction, the future of the 2016 overtime rule is still uncertain:

1. The USDOL sent a request for information asking the public to comment on a number of questions related to the overtime rule.

2. The USDOL’s appeal of the district court’s November 22, 2016 ruling is currently before the Fifth Circuit Court of Appeals. The district court’s decision may moot this pending appeal.

3. The USDOL may appeal the district court’s August 31, 2017 ruling.

As of now, employers need to ensure that they’re correctly classifying employees as exempt or non-exempt under the current federal regulations and applicable and state laws.

How Exempt and Non-Exempt Employees Differ

Have questions about the difference between exempt and non-exempt employees? We have some resources to help you out:

• A Simple Guide to Exempt vs Non-Exempt Employees Under the FLSA

In one of Justworks’ most popular blog posts, we explain the difference between exempt and non-exempt employees under the Fair Labor Standards Act, and what that means for your company.

• Fair Labor Standards Act (FLSA): A Brief Primer

The concept of exempt and non-exempt employees originates from the FLSA. This article gives a brief overview of topics such as exempt and non-exempt status, recordkeeping, and state and local requirements.

• Understand the FLSA Overtime Exemption Tests with 3 Easy Examples [Infographic]

Still confused about the difference between exempt and non-exempt employees? We made an infographic that gives concrete examples of the three criteria employees generally must meet to be exempt from the FLSA’s minimum wage and overtime requirements.

Justworks Can Help

Understanding changing labor laws can get overwhelming. Justworks is here to help. We help our customers easily manage employment-related compliance on our seamless platform. For customers seeking advice on their specific circumstances, we recommend our partner, LawTrades. You can learn more about us here.